Date
22 October 2017
Chief executive Ivan Chu (left) and chairman John Slosar announce strong results for Cathay Pacific Airways. Photo: HKEJ
Chief executive Ivan Chu (left) and chairman John Slosar announce strong results for Cathay Pacific Airways. Photo: HKEJ

Cathay Pacific to maintain 50% oil hedging position

Cathay Pacific Airways Ltd. (00293.HK) will hedge at least 50 percent of its jet fuel needs against any future increases in oil prices amid a fluctuating market.

This year, 62 percent of its jet fuel needs will be hedged at US$85 a barrel, the Hong Kong Economic Journal reports.

The ratio will decrease to 52 percent at US$89 in 2017 and 44 percent at US$81 in 2018.

The airline has yet to sign new hedging contracts at current prices, finance director Martin Murray said.

Hedging allowed the carrier to manage risk in volatile world oil markets, he said.

Murray said falling crude prices left the company worse off from its oil bets, although it still managed to nearly double its net profit.

The airline reported a consensus-beating net profit of HK$6 billion (US$772.8 million), up 90.5 percent from a year earlier, a six-year high.

It posted a hedging loss of HK$8.47 billion during the period despite a 40.3 percent decline in average fuel costs.

[Chinese version 中文版]

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