Collars make a comeback for Asian fuel hedging

Collar comeback

During the last market bull-run, oil prices steadily climbed to more than $140 per barrel by mid-2008, with some commentators at the time believing that prices could be driven as high as $200 a barrel. Airlines were faced with a dilemma in managing their fuel costs, which on average account for about 40% of operational costs for major carriers and can be as high as 70–80% for budget airlines. Oil prices were set to continue to rise, but volatility and the rising price made hedging against furthe