Fuel Contracts
 

Can I interest anyone on the 3rd floor in a May NYM light crude May delivery? Just up your street, buy for -38 there must be a bonus at year end for this Lulu...

Gotta put it somewhere... How about all those widebodies sitting on the aprons and taxiways in Hong Kong? That’ll make them heavier for when the season’s first typhoon blows through. Not a serious suggestion!

Last time I checked, if you stuck crude oil in the fuel tanks the engines wouldn't be too chuffed about it when you fired them up..

Would be like the whole VW scandal all over again!

OMAA

It'd be a bloody environmental disaster! We complained about the pollution over Hong Kong before... imagine if all those airplanes at HKIA fired up one by one with oil in the fuel tanks!

I wonder what price we are paying for fuel right now because oil at the moment is negative $38 . I never thought that I would see that

• The May US WTI contract fell $55.9, or 306%, to settle at a discount of $37.63 a barrel after touching an all-time low of -$40.32 a barrel

I believe CX is mostly hedged at around 60-70 usd. So not going to be pretty.

“There's an old saying in Tennessee — I know it's in Texas, probably in Tennessee — that says, fool me once, shame on — shame on you. Fool me — you can't get fooled again.”
― George W. Bush

Fool me once, shame on you. Fool me twice, shame on me.

Fool me thrice, must be a Cathay Pilot.

Rinse and repeat as necessary.

Yep, Oil today at $10.50 bl ... Expect more massive Fuel Hedging losses n 9th floor crying...

If an airline can get a massive unsecured loan it must have some heavy backers. Air China must come into play soon? What a victory for Beijing if so.

even worse, they will have hedged c 50-70% of expected fuel requirements. As so little flying is being done, that means they need to buy oil at the hedged price that they won’t even be using, ie they are probably now hedged around 200% of fuel...

To be fair and put it in perspective, that will also be the same with almost every other airline out there!

You can’t blame decisions made before the pandemic for there outcome now.

True, but maybe CX should have learned their lesson about fuel hedging after losing $4B USD in the last five years and just stick with the spot prices???

yeah but then what are all the MBA whizz kids going to do to earn their bonuses???

AA does not hedge fuel at all, their CEO says it is just not worth it in the long run. Based on the 4B USD we recently lost plus the losses that are coming, I would say he is right. CX has lost more money through their hedging department than they have ever gained. The fact that these people are still employed while continuing to lose billions of dollars for the airline is gross negligence.

Interesting to note that the fuel hedging loss was equal to 16 months worth of the $2billion per month we are supposedly losing. That’s quite a lot!

Why abandon such a tried and true way of stuffing CX cash into the Swire coffers without having to split it with other shareholders or ”the help” (employees)? If you think the Swires aren’t on the other end of these trades, then I have a bridge to sell you...

It is likely that a certain HK company may have lost more in fuel hedging in the past 5 years (and the next two or three to come) than they have probably earned in profits since the mid 80's. Fair to say that decades of effort and dedication of it's long suffering staff have effectively been rendered worthless. Oh, the Swire family is still amongst the richest in the UK however.

Maybe the Swires’ eternal destinies are less enjoyable than their present circumstances. I hate to admit it, but a part of me hopes so.