Delta 4th quarter loss - Page 2 - Airline Pilot Central Forums

#11

Timbo , 01-20-2015 07:48 PM

Runs with scissors

Quote:

Originally Posted by RockyBoy

Hedging is a strategy that is as polarized in opinions as vaccinating your kids.

If I were the fuel czar at Delta, I would ask for a billion dollars in about 6 months and buy enough bankrupt shale producers in North Dakota to supply Monroe Energy with enough Crude to supply them with their fuel needs.

We already have the refinery and are already buying Bakken crude for the place. I heard we even bought an oil tanker to bring oil from Texas to Trainor. Only thing left is to own the wells producing the oil and you have it covered. There should be some cheap ones up there in about 6 months.

A true top to bottom production system for their largest and most volatile expense.

Why don't we just "Buy" Iraq?

Then we could overfly it again, after we sent the Georgia Bulldogs and the ATL Falcons in to wipe out ISIS, and cut hundreds of miles off our flight to Dubai and Mumbai!

Win Win!

#12

BigGuns , 01-20-2015 07:58 PM

Gets Weekends Off

Quote:

Originally Posted by Timbo

Or just cut Mumbai!!!

#13

shoelu , 01-20-2015 09:15 PM

Gets Weekends Off

Quote:

Originally Posted by Oberon

I'd be interested in seeing stats that back up your claim that hedging has made more money than it has lost. I'm not sure that's true but don't have the ambition to sort through financial reports.

I think airlines hedge for planning purposes more than anything. I'm sure they'd prefer to make money but there is utility in knowing what your costs will be. When oil spikes it gives them time to react.

Well, the only company I have looked at in depth is Southwest. From 1998 to 2008 SWA saved more than $3.5 Billion due to hedging. That figure made up 83% of the company's total profits during those years. In the 6 years following SWA has on several occasions posted quarterly losses in the hundreds of millions. The long term gains have far outweighed the short term losses in the case of Southwest.

http://www.nytimes.com/2008/06/30/bu...4427.html?_r=0

#14

Timbo , 01-20-2015 09:27 PM

Runs with scissors

Quote:

Originally Posted by BigGuns

Or just cut Mumbai!!!

DONE!

#15

RockyBoy , 01-21-2015 07:45 AM

Doesn't Get Weekends Off

How Cheap Oil Has Delta Air Lines Jet Fooled - Forbes

#16

forgot to bid , 01-21-2015 08:38 AM

veut gagner à la loterie

Quote:

Originally Posted by Timbo

In your view ISIS must be extremely beatable and poorly coached.

#17

badflaps , 01-21-2015 09:06 AM

Gets Weekends Off

Quote:

Originally Posted by forgot to bid

In your view ISIS must be extremely beatable and poorly coached.

I think they wrote the book on unsportsman like conduct.....

#18

Air Cooled Dad , 01-21-2015 01:00 PM

On Reserve

Quote:

Originally Posted by shoelu

Take a look at where Southwest bought their hedges. Delta sold theirs. Another brilliant hedging move....doh!!!

#19

Sink r8 , 01-21-2015 01:02 PM

Gets Weekends Off

Most losses occur in the 4th quarter.

#20

Probe , 01-21-2015 08:23 PM

Don't say Guppy

Quote:

Originally Posted by shoelu

I wholeheartedly agree that SWA did great, especially 2006-2010. But extrapolating that and saying the whole industry should hedge because SWA did it great for a few years is like saying we should all go to the casino because granny hit it big on the slots last weekend.

I, and probably a bunch of others here, have been watching airlines' earnings reports for many, many years. I have seen far more losses reported due to hedging, than gains.

SWA either had a great trading desk back then, or just got lucky. Maybe both.