Oil plunges: Another $1B in UA savings
03-08-2020, 10:21 PM
#1
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Oil plunges: Another $1B in UA savings
This weekend alone, United's potential fuel savings have reached $1,500,000,000.
$28 WTI
$32 Brent
Oil prices were plunging by nearly 25 percent late Sunday, triggering broader global market losses, as a dispute among producers could lead an economyalready weakened by coronavirus facing a major oversupply of crude.
Dow Jones, S&P 500 and Nasdaq futures were firmly in correction territory, down over 12 percent from their recent all-time highs.
Brent crude, the international standard, lost $11.17, or 24.7 percent, to $34.10 per barrel, as of 10:15 p.m. Eastern time Sunday after earlier touching its lowest price since 2016.
$28 WTI
$32 Brent
Oil prices were plunging by nearly 25 percent late Sunday, triggering broader global market losses, as a dispute among producers could lead an economyalready weakened by coronavirus facing a major oversupply of crude.
Dow Jones, S&P 500 and Nasdaq futures were firmly in correction territory, down over 12 percent from their recent all-time highs.
Brent crude, the international standard, lost $11.17, or 24.7 percent, to $34.10 per barrel, as of 10:15 p.m. Eastern time Sunday after earlier touching its lowest price since 2016.
03-08-2020, 10:23 PM
#2
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Position: A320/321 CA
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Oil plunges: Another $1B in UA savings
I wonder if some rampant hedging will be going on. Saudis flooding the market to **** off Russia/OPEC.
This could very well offset losses due to loss of travel demand and gain vast savings in fuel.
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This could very well offset losses due to loss of travel demand and gain vast savings in fuel.
Sent from my iPhone using Tapatalk
03-08-2020, 10:30 PM
#3
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03-08-2020, 10:37 PM
#4
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03-09-2020, 07:49 AM
#6
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Good point. If we make less revenue and or we fly thousands of less hours due to reduced schedules does that mean we actually saved that much cash this year? Seems like the an
03-09-2020, 08:11 AM
#7
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Well it's still better than expensive gas right? 2 questions: 1) Are we already hedged at a higher price and 2) Do we have the cash to actually take advantage of a hedge? We may be trying to save every penny we can.
03-09-2020, 08:32 AM
#8
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Joined APC: Feb 2011
Posts: 4,967
This weekend alone, United's potential fuel savings have reached $1,500,000,000.
$28 WTI
$32 Brent
Oil prices were plunging by nearly 25 percent late Sunday, triggering broader global market losses, as a dispute among producers could lead an economyalready weakened by coronavirus facing a major oversupply of crude.
Dow Jones, S&P 500 and Nasdaq futures were firmly in correction territory, down over 12 percent from their recent all-time highs.
Brent crude, the international standard, lost $11.17, or 24.7 percent, to $34.10 per barrel, as of 10:15 p.m. Eastern time Sunday after earlier touching its lowest price since 2016.
$28 WTI
$32 Brent
Oil prices were plunging by nearly 25 percent late Sunday, triggering broader global market losses, as a dispute among producers could lead an economyalready weakened by coronavirus facing a major oversupply of crude.
Dow Jones, S&P 500 and Nasdaq futures were firmly in correction territory, down over 12 percent from their recent all-time highs.
Brent crude, the international standard, lost $11.17, or 24.7 percent, to $34.10 per barrel, as of 10:15 p.m. Eastern time Sunday after earlier touching its lowest price since 2016.
03-09-2020, 10:30 AM
#9
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Joined APC: Mar 2006
Position: guppy CA
Posts: 5,171
Page 5 of United's annual report:
Our operational and financial results can be significantly impacted by changes in the price and availability of aircraft fuel. To provide adequate supplies of fuel, the Company routinely enters into purchase contracts that are customarily indexed to market prices for aircraft fuel, and the Company generally has some ability to cover short-term fuel supply and infrastructure disruptions at certain major demand locations. The price of aircraft fuel has fluctuated substantially in the past several years. The Company's current strategy is to not enter into transactions to hedge its fuel consumption, although the Company regularly reviews its strategy based on market conditions and other factors.
As for the second part of your question, United's probably already quietly put on hold every CapEx we can in order to preserve cash along with checking on lines of credit.
I have no idea what our current cash burn looks like but it's probably breathtaking. The airline business has huge fixed costs.
03-09-2020, 10:52 AM
#10
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Position: guppy CA
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US frackers, Canada, Venezuela, and a few others are going to be crushed by this.
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