Might be another bumpy ride .
04-09-2011 | 10:21 AM
#1
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From: whale wrangler
04-09-2011 | 04:11 PM
#3
With The Resistance
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From: Burning the Agitprop of the Apparat
You can sometimes find out who is hedging and how much, but in the end hedging is only a short term strategy and it's effectiveness is limited by prolonged price increases.
Jet Fuel Hedging Positions for U.S., Canadian Airlines - Bloomberg
It is also interesting to note that some airlines have lost a great deal of money hedging in the wrong direction. Much of this happened during the last spike in oil prices.
"Cathay's results were also hit hard by hedging positions it had taken out against the high cost of fuel.
As the oil price plummeted in the second half of 2008 to below 40 US dollars, those hedges were extremely costly and forced Cathay to write off 7.6 billion Hong Kong dollars in potential losses.
Pratt said up to the end of February the airline was facing further possible losses of 1.9 billion dollars on its hedging positions, as the global oil price remained low."
That's well over a billion dollars US.
Jet Fuel Hedging Positions for U.S., Canadian Airlines - Bloomberg
It is also interesting to note that some airlines have lost a great deal of money hedging in the wrong direction. Much of this happened during the last spike in oil prices.
"Cathay's results were also hit hard by hedging positions it had taken out against the high cost of fuel.
As the oil price plummeted in the second half of 2008 to below 40 US dollars, those hedges were extremely costly and forced Cathay to write off 7.6 billion Hong Kong dollars in potential losses.
Pratt said up to the end of February the airline was facing further possible losses of 1.9 billion dollars on its hedging positions, as the global oil price remained low."
That's well over a billion dollars US.
Last edited by jungle; 04-09-2011 at 04:22 PM.
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