[QUOTE=rickair7777]OOOPS.
Now that we know a little bit about how it works, and given that oil is now $60/barrel...lets ask ourselves who in the HELL do you think is going to sell SWA fuel hedges at $25/barrel for 2010+ ??????? QUOTE]


Rickair7777
Of course SWA or (UAL, FDX Or UPS or AAL or anybody for that matter) can't buy oil at today $25/barrel........

They can however........speculate as you say or Gamble and buy oil at $65.00/barrel or $70/barrel ( just an example price, it might actually be more)..............to be deliverd in 2007 or 2008.

If oil stays at $60/barrel for the next 2 years, the hedge was a bad move because you are now paying $5 to $10/barrel more than the market price.....................but if oil goes to $85/barrel.........it was a good gamble because they will be paying $10-$15 below future market price.
If they can continually pull it off........... good on'em and good Management.

If they blow it........a senior Airline Exec will be fired and have to take his 50 million gloden parachute and the new guy will ask his employees to take a 40% pay cut,,,,,,,,,,,,,,and he will get a 75 million bonus for cutting costs.

Sorry.........couldn't resist..but it is closer to truth than fiction