A copy of this work was available on the public web and has been preserved in the Wayback Machine. The capture dates from 2017; you can also visit the original URL.
The file type is application/pdf
.
Airline Jet Fuel Hedging: Theory and Practice
2006
Transport reviews
Hedging fuel costs is widely practiced by most international airlines but its theoretical justification is weak. This paper explores the nature and extent of airline fuel hedging and asks why airlines hedge. A policy of permanent hedging of fuel costs should leave expected long-run profits unchanged. If it damps out profit volatility, it should do so in a way that the market would not value. However, it may not damp out volatility, after all. Oil prices and air travel demand cycles are linked
doi:10.1080/01441640600679524
fatcat:dnyzrvxbovdq7gfix7pp27sjpq