Q&A: Is There A Big Difference In Profits Right Now Between Airlines That Hedge Their Fuel Costs And Those That Don’t?

Q&A: Is There A Big Difference In Profits Right Now Between Airlines That Hedge Their Fuel Costs And Those That Don’t?

over 1 year ago1 min

Question: “ Is there a big difference in profits right now between airlines that hedge their fuel costs and those that don’t? ”

Answer: “There certainly is, Josh. Non-US airlines have been far less effective at hedging their fuel prices – that is, locking in what they’ll pay months ahead of time via futures contracts – than their American counterparts, while at the same time often being hit harder by the impact of rising fuel prices. That might go some way to explain why North American airlines are forecast to make a collective profit of $8.8 billion this year, while every other region is set to make a loss.”

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