- Some major U.S. airlines including Delta and Southwest are rushing to finance losing bets on oil and revamp fuel hedges as tumbling crude prices leave them with billions of dollars in losses, according to people familiar with the hedging schemes.
In theory, airlines are among the top beneficiaries of a six-month slump that halved crude prices to five-year lows. Oil is the biggest variable cost for airlines, often representing a third or more of their total operating expenses.
But now, carriers such as Delta Air Lines and even Southwest Airlines, known for a successful hedging program that locked in cheap fuel prices before they rose a decade ago, see some of the benefits of cheap fuel eaten away by hedging costs.
I had been wondering about this -- I read the other day that Ryanair hedged almost all of their fuel costs at ~$92 last year, meaning they haven't profited really at all from the massive decline in oil prices. And that sucks, because with the euro to dollar dropping to almost 1:1.1, I wanna head to fucking Europe this summer.
Other cheap transatlantic carriers include Norwegian: http://www.norwegian.com/us/flight/lowfare/NewYork-LondonGatwick
If you can manage to get to Denver somehow, Icelandair has really damn cheap flights to most of Europe. One way ticket for $550-$600. Lowest I found was $384 to Berlin on a Wednesday in May. Ryanair should never be flown for more than an hour or three, as it's one of the worst airline experiences.
I planning to fly Icelandair to England this summer. They let you choose up to a week layover in Iceland, so I thought it would be a cool way to take a few day detour to Reykjavik on y way to a necessary trio to the UK. I'm not sure I'd go otherwise, but it looks like a beautiful country. Have you flown them before? If so, is it a decent way to travel?
I picked Icelandair for my parents when they came to visit me in Canada. On the way back they did a two day layover. I recommend it if you're at all interested in visiting Iceland. Only big downsides are the times of arrival and departure, which are usually really early in the morning, and the rather expensive hotels. Transfers on Reykyavik are quick (1 to 2 hrs) on the way back.