Originally Posted by
shiznit
Anybody see the Reuters story that said Trainer is supposed to make a $300 million yearly profit with a $16 crack spread?
It went on to say that the current Brent crack is roughly $20, and the Bakken is running about $42!
The gain is roughly $18.75 mil per dollar of crack.
$20 crack would yield $375 mil yearly
$42 crack would yield $787.5 mil yearly
If UAL wants to buy a refinery we should either buy it to capture the "20% domestic and whatever % international", or bid it up high so UAL massively overpays.
I dont know the rules vis a vis refining your own fuel, but IMO DAL also has the ability to remove state and federal tax from jet fuel burned in our aircraft, but will charge fed and state tax when sold to competitors.
Taxes are a big chunk of fuel cost. Couple that with hedging and directly buying from Bakken shale providers and you have a powerful money generator (or cost cutter).