Seeking a smooth ride

Air India

Against the backdrop of soaring fuel prices and a major fleet expansion, Air India recently started to hedge its jet fuel exposure in the international market. The initial deal saw India's number-one airline hedge 10,000 barrels of fuel through a swap conducted with Citigroup as counterparty and Ernst & Young as risk management consultant.

India's air travel industry has seen phenomenal growth in recent years. In December 2005, 7.24 million passengers - domestic and international - came throu