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Not hedging pays off for Chinese airlines

They will report lower costs and are also expected to benefit from lower fuel surcharges from falling oil prices

Published Wed, Aug 5, 2015 · 09:50 PM
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Singapore

AFTER many airlines were burned because of slumping fuel prices in 2008 and 2009, Chinese carriers stopped hedging their fuel purchases - even when prices soared above US$100 a barrel. Now they are having the last laugh.

Air China Ltd, China Eastern Airlines Corp and other Chinese carriers are expected to benefit the most after oil prices in London fell below US$50 a barrel on Monday to their lowest closing price in more than six months. On Tuesday, Brent crude futures for September settlement inched up to US$49.99.

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