Oil hit $130 per barrel.
 

I was wondering what it means to jetBlue to have Oil at $130 per barrel.

Will hiring stop ? Airplane orders deferred ?

furlough?

Go!

Guaranteed furloughs we’re supposed to happen during the scamdemic when flying went to basically nothing….how many did we furlough?

People will still travel, if anything when they see what it costs to drive, people might actually perceive better value in an airline ticket.

Who knows. What’s the adage….hire until you furlough? With that said you can’t be scared to make a move in this industry based on what you perceive may or may not happen if you believe it’s the right move. The inherent risks this job entails we all signed up for. Good luck.

My crystal ball doesn't even know.

I sure hope the NEA AIP still has furlough protection in it.

The Eight Ball says "Reply hazy, try again" second shake "cannot predict now" Anybody saying one way or another is really just taking a WAG...

Kampai...

I hope this is a joke...

For those freaking out about oil prices, oil STILL hasn't reached it's all time high of $145 per barrel, from 14 YEARS ago. Inflation adjusted, we aren't even close to the previous record, NOT EVEN CLOSE.

There is so much demand for travel that much or most of the cost could probably be passed on to the consumer and still have high load factors. This past holiday week in the northeast had basically 100% load factors everywhere, which means airlines already aren't charging enough for tickets.

Using a historical inflation calculator, oils previous record of $145 in 2008 translates to a price of $189 today just to match it's previous record high.

Stop wetting the bed.

https://www.usinflationcalculator.com/

My guess is if it looks like it will be prolonged we'll start seeing routes cut back. The added benefit of alleviating the staffing issues going on. Look, remember back in 2020? All of a sudden United canceled a new hire class just a few days before it was set to start. Everyone said "WTF??" Then one by one airlines started announcing reductions in schedules. This stuff doesn't happen overnight but I think we'll start seeing indications shortly that we're going into a contraction phase. We're losing money coming out of the pandemic and were supposed to return to profitability this year...I don't see it happening, not with oil where it's at.

During the later stages of the last high oil price period airlines got pretty good at passing most of the oil price through to customers via ticket prices and oil surcharges. It all depends on what happens to travel demand. If demand remains high, there will be less or minimal impact. Some airlines will certainly cut routes, and the more aggressive airlines and the airlines that are managed well enough to be attractive to customers might take the opportunity to grab the remaining available market share.

Nothing about the current situation lends me to think that demand will be higher this year than what the company had already forecast. Prices will go up, consumers will have less disposable income....meanwhile the company's 2nd highest cost (fuel) will shoot up. I mean I'm sure they'll try to pass higher costs along to the customer...I'm not saying it's game over, but I don't need a Robin Blue Note to tell me that landscape isn't what it was 3 weeks ago. I wouldn't want to be on the bottom of a certain airline partner's Seniority list at the moment.

Except that oil should be deflationary and its cost should decrease over time as we have better technology to extract more and more of it. The fact that it is increasing is a very bad sign.

No, not really. The easy and plentiful sources are becoming more scarce. It takes high tech ways of getting oil from more difficult places, just to meet demand. Some of those high tech, higher cost means of production were temporarily shut down when the price of oil crashed. They will now become economically viable again and will come back online in time. Won't happen tomorrow, or Thursday, but in the coming months/year they will be producing more oil again.

But, this is an unusual time as we have an open war going on in Europe. To expect no energy price disruption, or to be a bed wetter because you didn't expect an energy price disruption is ridiculous. Especially as the price of oil is no where near it's inflation adjusted all time high, not even close. The last time oil was LESS than it costs now, most other goods we bought cost half what it does now... So everything else has doubled in price since 2008, but oil hasn't even matched it's 2008 price.

And it's not a "sign", there is a major war going on and the state engaging in that war is a major oil producer. It's not a sign, it's a symptom of current events.

Change your diaper and your bed sheets.

You make some great points. Let them stand on their own. No need to be condescending.

I'm starting to read Peter Zeihan's "Absent Superpower," which opens with some fantastic information about shale. The general feel I get is that as long as we have a President who's beholden to the environmental religious orthodoxy of the left, we're in for a tough ride. So are the Ukrainians, but that's another topic. The short version is we have the ability to be largely energy independent in North America if that was politically palatable to the latte liberal crowd. But it's not, so here we are. Draw your own conclusions.

indeed. Coal can fill some of the void in the short term, if allowed. (Awaiting the stone throwing.)

The US was on track to produce a record amount of oil even before Ukraine crisis:

https://www.bloomberg.com/news/artic...uction-in-2023

The United States is the largest oil producer in the world:
https://ichef.bbci.co.uk/news/976/cp...oducers-nc.pnghttps://www.bbc.com/news/58888451

There are literally hundreds of unused approved government drilling permits out there the oil companies haven’t used yet. I have two family members who work in this industry. This isn’t the left/Biden’s fault. The US oil companies let go tens thousands of employees under Trump because of the covid crisis fuel slump. They are still recovering from that, and the shale/fracking industry was already downtrodden before covid. It takes time to put all those contractors and resources back into action. It’s a multi-year process.

The US consumes roughly 18 million barrels a day and is capable of producing just over 16 million barrels a day. We could essentially be self reliant now! But the big oil companies are simply trying to use this crisis for their long term gain. We let them sell our oil away to other nations

And five months after oil hit $145 in 2008 it was at $31...............history.

Panic now, learn later. Although, probably will panic but not learn.

Oil spikes are short lived, unless OPEC decides to not increase quotas. Shifts in production and changes in logistics (this time Russia) don’t happen over night. It’s a global market (but not a free market) influenced by a cartel and the politics of the day. Price panics (usually) incentivize production where it’s easy. Prolonged price hikes incentivize new exploration and technology. The Saudis tried their darndest to kill the shale industry by increasing supply and suppressing prices.

Oil back below $100 a barrel.

I'm sure it'll take a few months before gas prices decide to follow the same downward trend.

Sad but true. Rocket up, down like a feather. There really isn't a mechanism that causes that, simply that station managers when oil prices are rising take the opportunity to raise prices rapidly, possibly even getting ahead of oil price increases, and on the way down they drag their feet reluctantly to lower them. Great for consumers.

10% inflation.
Ukraine/russia war
Fed policy tightening tomorrow
oil prices just soared
Covid pandemic (still going on)
supply chain issues
a recent pull back on all markets

I don’t think pilots should be concerned about oil prices falling over 25% since it’s high. Think they should be concerned of the fallout that happens after. Not saying it’s going to happen. However it’s much bigger than oil prices.



https://www.bloomberg.com/news/artic...-u-s-recession

Yes, that's definitely a lot for the market/economy to digest. As for the recent pullback in markets, how could that not be expected? As you say, there is a majorly disruptive war going on. And... The US stock market has been in an absolutely unprecedented climb, spanning THREE presidential administrations. That just doesn't happen, and continue on forever. Markets need corrections, and they always come... Is it a long term change in direction or a normal correction? Most never know until it's in the history books. Most pro traders can't call tops and bottoms consistconsistently. The most recent jobs report was a surprise to the good side and employment is still strong. Hopefully we weather the current storm.

You realize in most states gas stations make very little profit off their gas? They are actually mandated to price it too make at least x amount of profit off every gallon. Gas stations make a large majority of their profits off all the junk food and gizmos they sell in their stores.

https://thehustle.co/why-most-gas-stations-dont-make-money-from-selling-gas/

MOST of the time prices are stable. This discussion was specifically about large gyrations in oil prices. You realize.

That’s why prices change almost daily at gas stations. They change every time the get a load of fuel (which is several times a week) to compensate for the price of that load.

Most of the time they change a LITTLE bit daily, which doesn't allow for the phenomenon I was describing, which happens during periods of LARGE oil price fluctuations.

I’m just saying the price is based on how much the stations are paying. I’m not saying the price comes down slower than it goes up. Just saying it’s not the stations gouging us. It’s the refineries gouging them. Or the traders gouging the refineries. It’s somewhere farther up the chain than the gas station managers.

There's not really a way to say that with certainty. Yep, each guy along the way takes his cut, but it's a pretty widely observed phenomenon that prices at the pump go up rapidly, during times of large oil price gyrations, but come down slowly, even when the price of crude drops rapidly.

The argument that gas stations don't normally make a lot on fuel sales doesn't prove they don't engage in what I have described, because frankly oil can go an entire year, or years, without have large gyrations in price like we have seen recently.

Keep in mind that the independent stations have to make enough money on the current load of gas to be able to pay for the next one.

And... When the price is dropping precipitously the NEXT load will be much cheaper, yet they keep the pump prices high well past the time crude oil pricing goes down. There is a blatant disconnect between how fast prices at the pump go up when oil is rising vs how slowly pump prices go down when oil price is falling.

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Except that their competition across the street will lower their price by a penny to try and get people in to their store.

Yeah, sure they will. That's why everything is so cheap now, all businesses are cutting prices and profits to the bone fighting over customers. Remind me, how are corporate profits the last couple of years?

Can someone explain this ******* then? Is he really paying the delivery truck 30-40 cents more a gallon than EVERYONE else around?

Reminds me of that place in Orlando next to the Buffalo Wild Wings. They’ve been charging almost $6 per gallon for years. And the price signs are basically hidden behind the shrubs.

That didn’t last….

They do that on purpose for people who are returning their rental cars and don't know any better.

No doubt...