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LH increases[/reduces] fuel surcharge

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Old Sep 2, 2015, 7:49 am
  #406  
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Originally Posted by oliver2002
Some LH view of fuel prices:

“Financially weak airlines which cannot afford hedging are benefiting from low prices above all – they can now buy cheaply,” Menne explains.

I do wish Lufthansa would stop whining. One day it's unfair competition from the middle-east, now it's competition from weaker carriers
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Old Sep 2, 2015, 7:52 am
  #407  
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Originally Posted by oliver2002
“Financially weak airlines which cannot afford hedging are benefiting from low prices above all – they can now buy cheaply,” Menne explains.



Financially strong airlines which can afford to self-insure, and those with clearer crystal balls (or greater luck) than la Menne, also benefit from current fuel prices.
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Old Sep 2, 2015, 7:54 am
  #408  
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The fact that they hedged when Oil was at 120 and 80 hit them hard. Of course now you can hedge at 50-60$
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Old Sep 2, 2015, 8:18 am
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Hedge at 60 and you'll be hit hard again when oil is 45
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Old Sep 2, 2015, 8:32 am
  #410  
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Originally Posted by Fabo.sk
Hedge at 60 and you'll be hit hard again when oil is 45
or even down to $10 as this analyst boldly speculates:
http://uk.businessinsider.com/gary-s...15-2?r=US&IR=T
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Old Sep 2, 2015, 8:38 am
  #411  
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There is a reason why CFOs don't like hedges...
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Old Sep 2, 2015, 10:53 am
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Hedging is akin to gambling. You take a bet on a price change. The fact that LH is paying more for fuel because of hedging is merely the result of a poor decision.

One could read the press release up thread to mean that LH couldn't use the previous positive results of hedging, when fuel prices were rising, to their advantage. Now, prices are falling, and they're whining that the negative effects of hedging are impacing their profit margin.

My heart bleeds for them. Not!
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Old Sep 3, 2015, 2:27 pm
  #413  
 
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Originally Posted by Tafflyer
and they're whining that the negative effects of hedging are impacing their profit margin.
A very smart execuse for LH management to not lower the YQ
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Old Sep 4, 2015, 1:33 am
  #414  
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One could argue the YQ pays for the lost hedge

Anyway, 24 of the 96 widebodies (the A346 fleet) in service have fuel consumption guarantee/refund from Airbus, so the cost for those was also capped during the very high fuel prices.
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Old Sep 4, 2015, 10:20 am
  #415  
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Imagine LH hedged oil at USD 40 for two years and the oil is rising to 120 USD within this 2 year span.
LH wont decrease YQ. They should decrase because they have won the gamble.
Instead they will raise the YQ and never mention the hedge at all.
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Old Sep 4, 2015, 3:59 pm
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Originally Posted by warakorn
Instead they will raise the YQ and never mention the hedge at all.
I mentioned on many occasions in this forum that YQ is there to stay and right now it does not have any relevance to oil prices. It is becoming a cash cow for airlines and a stable generated income thst they can't give it up even if oil prices drop to $ 10.
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Old Sep 4, 2015, 10:57 pm
  #417  
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Originally Posted by NA-Flyer
I mentioned on many occasions in this forum that YQ is there to stay and right now it does not have any relevance to oil prices. It is becoming a cash cow for airlines and a stable generated income thst they can't give it up even if oil prices drop to $ 10.
Yes. But (*censored* -- I was referring to that brown stuff often found covering the ground on farms) doesn't stink less just because one points out the smell at every occasion.

HTB.
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Old Sep 5, 2015, 12:36 am
  #418  
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Originally Posted by NA-Flyer
I mentioned on many occasions in this forum that YQ is there to stay and right now it does not have any relevance to oil prices. It is becoming a cash cow for airlines and a stable generated income thst they can't give it up even if oil prices drop to $ 10.
I gently note that with YQ part of our world for a couple of decades, there's a reason your insight hasn't earned applause.
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Old Sep 5, 2015, 3:53 am
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I updated the YQ graph to fuel (pun intended) your holy rage.

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Old Sep 6, 2015, 2:00 am
  #420  
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Originally Posted by kanor
If we exclude the possibility that LH is trying to rip us of, the only other conclusion is that LH continuously messed up their fuel hedging, resulting in enormous losses as compared to not hedging.

HTB.
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