BoeingBoy
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$82 Bucks a Barrel
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BoeingBoy
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Lately? Don't know about that, but there are hedges in place. Off the top of my head, about 35% of 3rd and 4th quarter needs at between $65 and $75 per barrel. Give me a few minutes and I'll check the accuracy of my memory........
Jim
Jim
BoeingBoy
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From the 2nd quarter report:
Our primary market risk exposures include commodity price risk (i.e., the price paid to obtain aviation fuel), interest rate risk and equity price risk. Our exposure to market risk from changes in commodity prices, interest rates and equity prices has not changed materially from our exposure discussed in our 2006 Form 10-K except as updated below.
Commodity price risk
As of June 30, 2007, we have entered into costless collars to protect ourself from fuel price risks. These transactions are in place with respect to approximately 35.7% and 5.2% of remaining projected 2007 and 2008 fuel requirements, respectively.
In the 1st quarter report, there was a slight difference in the percentages hedged:
As of March 31, 2007, we have entered into costless collars to protect ourself from price risks. These transactions are in place with respect to approximately 36.5% and 1.8% of remaining projected 2007 and 2008 fuel requirements, respectively.
From the annual report (again, the percentage of needs is different indicating that additional hedges were put in place during the 1st quarter):
The Company utilizes financial derivative instruments primarily to manage its risk associated with changing jet fuel prices. The Company currently utilizes heating oil-based derivative instruments to hedge a portion of its exposure to jet fuel price increases. These instruments consist of costless collars which hedge approximately 29% of its 2007 total anticipated jet fuel requirements as of December 31, 2006. The Company does not purchase or hold any derivative financial instruments for trading purposes.
The weighted average collar range of the fuel hedges outstanding as of December 31, 2006 are as follows:
Heating oil ($/gallon) - Put Options @ $1.86 and Call Options @ $2.06
Estimated Crude Oil Equivalent ($/barrel) - Put Options @ $68.78 and Call Options @ $77.18
Jim
Our primary market risk exposures include commodity price risk (i.e., the price paid to obtain aviation fuel), interest rate risk and equity price risk. Our exposure to market risk from changes in commodity prices, interest rates and equity prices has not changed materially from our exposure discussed in our 2006 Form 10-K except as updated below.
Commodity price risk
As of June 30, 2007, we have entered into costless collars to protect ourself from fuel price risks. These transactions are in place with respect to approximately 35.7% and 5.2% of remaining projected 2007 and 2008 fuel requirements, respectively.
In the 1st quarter report, there was a slight difference in the percentages hedged:
As of March 31, 2007, we have entered into costless collars to protect ourself from price risks. These transactions are in place with respect to approximately 36.5% and 1.8% of remaining projected 2007 and 2008 fuel requirements, respectively.
From the annual report (again, the percentage of needs is different indicating that additional hedges were put in place during the 1st quarter):
The Company utilizes financial derivative instruments primarily to manage its risk associated with changing jet fuel prices. The Company currently utilizes heating oil-based derivative instruments to hedge a portion of its exposure to jet fuel price increases. These instruments consist of costless collars which hedge approximately 29% of its 2007 total anticipated jet fuel requirements as of December 31, 2006. The Company does not purchase or hold any derivative financial instruments for trading purposes.
The weighted average collar range of the fuel hedges outstanding as of December 31, 2006 are as follows:
Heating oil ($/gallon) - Put Options @ $1.86 and Call Options @ $2.06
Estimated Crude Oil Equivalent ($/barrel) - Put Options @ $68.78 and Call Options @ $77.18
Jim
Interesting article about US Airways selecting PIT for a consolidated Flight Operations Control Center. Includes a brief talk about the effect of fuel prices and low fare competition and their affect on profitable routes needed to subsidize non-profitable routes.
http://www.pittsburghlive.com/x/pittsburghtrib/s_528607.html
http://www.pittsburghlive.com/x/pittsburghtrib/s_528607.html
sharktooth
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Didn't SWA just add $10 per fare for "increased fuel costs"? Would that not constitute a surcharge?
A rose by any other name would smell as sweet: Shakespeare, "Romeo and Juliet".
BoeingBoy
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Technically not a surcharge since it's an increase in the base fare rather than a separate charge tacked on to the base fare. As you say, though, the effect is the same.
On the other hand, would a reduced fare - WN has a sale to some destinations going on now I think - be a fuel discount......
Jim
On the other hand, would a reduced fare - WN has a sale to some destinations going on now I think - be a fuel discount......
Jim
sharktooth
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Do they say the reduction is because of lower fuel costs?
jimcfs
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I live about 15 min from BLF and 40 min from BKW.
Colgan provides the EAS service under US Express to IAD from BLF/BKW. Colgan has announced they are terminating service to BLF in mid-November, partially because of the EAS money to BLF being cut, but more importantly, they are getting rid of their B1900s on the East Coast and replacing them with Saab 340s. Apparently, the runway at BLF isn't long enough to SAFELY (their word) operate the 340. So, they apparently are using the safety card to really say they don't make money in BLF even with the EAS $$ coming in.
Colgan would do better if the service (or at least one or two of the three per day) went to CLT instead of IAD... but that makes too much sense, which is why I'm not an airline exec.
BoeingBoy
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Nope, not that fuel costs are lower anyway.....
Surcharge: an additional tax, cost, or impost
Jim
nycbusdriver
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Actually, the national government is NOT printing the money, nor does the federal government decide when to expand the money supply or contract it. The Federal Reserve does all of this, and the Federal Reserve is a private corporation. While the Federal Reserve took that name at its inception to make the general public THINK it is part of the federal government, it is in fact NOT. It is a private corporation owned by the big banks in this country. Ever wonder what makes a "National Bank" national? It means that bank own stock in the Federal Reserve...the central bank of the United States.
It's not conspiracy theory. Google it and find out for yourself. All of it is above board and public record for the near century existence of the Federal Reserve System...it's just that most citizens don't care to know who really controls the economy.
Ever wonder why that paper money in your pocket is called a "Federal Reserve Note"? It's because it is an instrument of the Federal Reserve System, and NOT the government of the United States.
Mayer Amschel Bauer, who founded the Rothschild family had said, "Give me control of a nation's money and I care not who makes the laws"
autofixer
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Point taken; however, the Federal Reserve (Central Bank) is a sudo-governmental organization. The Congress does have to give It's blessing to the Chairman. The Chairman does have to go up to the Hill and give his take on the economy and answer to the "know it all" congressmen (Hawkins).
I live about 15 min from BLF and 40 min from BKW.
Colgan provides the EAS service under US Express to IAD from BLF/BKW. Colgan has announced they are terminating service to BLF in mid-November, partially because of the EAS money to BLF being cut, but more importantly, they are getting rid of their B1900s on the East Coast and replacing them with Saab 340s. Apparently, the runway at BLF isn't long enough to SAFELY (their word) operate the 340. So, they apparently are using the safety card to really say they don't make money in BLF even with the EAS $$ coming in.
Colgan would do better if the service (or at least one or two of the three per day) went to CLT instead of IAD... but that makes too much sense, which is why I'm not an airline exec.
That's because one of the requirements for EAS is that the hub airport have cheap fares for those who have to buy two tickets. CLT fares have dropped recently but I guess not soon enough for the current EAS contract.
Remember when the flights used to go to CMH? I flew out of BLF one time to CMH and then to PHL. The schedule (and reality) worked out nicely, but that was back when PHL wasn't such a cluster.
