I just figured out where Carl has been.....

http://graphics8.nytimes.com/images/...ticleLarge.jpg

http://www.nytimes.com/2012/05/18/mo...irit.html?_r=1

Is he holding that guys hand? Hmmm:p

Excuse me is it Adam Smith? Nah, must be John Maynard Keynes.

It isn't a supply and demand issue when you are vertically integrated. DAL will produce 80% of the Jet fuel that it uses Domestically. The crack spread is what kills a huge user like DAL, it is often 30% of the price of a commodity it uses more of than several countries.

This isn't a venture seeking to make profit, it is a venture that seeks to control cost. The ENTIRE expense of the refinery will be covered before it is producing fuel for DAL for 1 year. Yes, thats right 1 year. The only way it can lose is by exploding - and it is probably insured for that.

Attempt to do a modicum of homework before attempting to spout some erudite BS that is flacid when you read it.

And no, I'm not the TOTD I am the DOTD because I dont suffer fools.

Thanks, that is a much more informative response. How is the expense covered for 1 year?

Get a napkin and get a pen. Add up the cost of the crack spread passed on to DAL and subtract all costs associated with the refinery. Let us know what you come up with.

Anyone know when they process PCS requests for reserve pilots wanting to swap next month's off days? Did not get my requests despite plenty of staffing...

Ok, I just did that. I came up with the fact that Delta won't be able to compete with Exxon, Sunoco, or any other oil company.

we aren't trying to compete with them. we are trying to produce a large percent of our own fuel.

The first PCS run for June is on May 20th at 0700.

If you can't do it cheaper than them, you're losing money on every gallon you produce versus other investment/hedging techniques.


I wonder if Delta will one day reach the point where a greater percentage of their flights are fueled by Delta fuel than piloted by Delta pilots. In-source refineries, outsource pilot jobs. Ugh.

Isn't DAL's fuel guy an ex CONOCO exec, think he understands something about the refining business.

DAL thinks it can beat the EXXON retail price by refining the crude into jet fuel and selling the other products. Guess time will soon tell.

Also, fuel hedging is expensive (capital up front, price of contracts), so unless you get hedges and then a big rise in fuel prices they don't make sense. In fact you can buy them at great expense and then see fuel prices actually fall causing even more expense.

lolwut though, you seem to have it all figured out so I think a mgmt position at UNICAL is up your alley, they appear to need additional expertise at the moment.