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Fuel hedging proves costly for US airlines as oil prices plummet

Delta exited hedge contracts at a cost of US$100 million to US$200 million per quarter. It forecast savings at US$3 billion this year. The big winner is American Airlines because it did not hedge fuel at all.

New York

THE lowest fuel prices for more than a decade are proving to be a double-edged sword for US airlines.

While carriers saved hundreds of millions of dollars from oil prices halving since June, they forfeited a large chunk of that gain because of the fuel hedges they bought...