A new study finds that nearly half of commercial airlines are not utilizing hedging and risk management strategies that accurately reflect the companyâ€™s tolerance for risk and corporate objectives.
Online PR News – 18-April-2012 – Houston TX – Study Reveals Many Airlines Have Yet to Adopt Energy Hedging & Risk Management Best Practices
A new study finds that nearly half of commercial airlines are not utilizing hedging and risk management strategies that accurately reflect the companyâ€™s tolerance for risk and corporate objectives, indicating that many airlines have yet to adopt energy hedging and risk management best practices.
The State of Airline Fuel Hedging & Risk Management, a report released today by Mercatus Energy Advisors and Airline Economics, highlights the findings of a study conducted to reveal the current fuel hedging and risk management practices of commercial airlines.
Key Findings of the Study
â€˘ 39% reported that their fuel hedging programs do not utilize hedging strategies which accurately reflect the companyâ€™s risk tolerance and hedging goals
â€˘ 36% indicated that their fuel hedging program is deemed a success if it mitigates cash flow volatility
â€˘ 61% stated that either a hedge committee or their board of directors are responsible for making hedging and risk management decisions
â€˘ 50% said that they have hedged less than 40% of their anticipated fuel consumption for the coming 12 months
â€˘ 76% indicated that they have an official fuel hedging and risk management policy
â€śIn the current environment, where uncertainty and volatility have become the norm, it is vital that commercial airlines employ a sound fuel hedging and risk management program. A proper hedging program will not only allow them to survive the most challenging of times, but also to excel in the best of times as well,â€ť said Mike Corley, president of Mercatus Energy Advisors.
The complete results of the study can be downloaded via the following link: http://www.mercatusenergy.com/state-of-airline-fuel-hedging/
About Mercatus Energy Advisors:
Mercatus Energy Advisors is the leading, independent energy hedging & risk management advisory firm serving energy consumers and producers across the globe.
Learn more at www.mercatusenergy.com
About Airline Economics:
Airline Economics is the foremost global publication dedicated to news and analysis for aircraft owners, operators and lessors and everything that affects the day-to-day running of their business.
Learn more at www.aviationnews-online.com/airline-economics