Many US airlines are hedging less of their jet fuel needs this year, as lower prices encourage spot market exposure. Airline hedging strategies vary, ranging from no hedges to 12-50pc of fuel consumption hedged for the rest of 2016. Lower fuel prices compared with a year earlier — as well as some hedging losses this year amid market volatility — have encouraged many airlines to opt for a lighter hedge book for now. US Atlantic coast jet fuel prices averaged about $1.32/USG in the second quarter, down by 28pc from a year earlier. Gulf coast prices fell to $1.27/USG, down from $1.76/USG a year earlier, while midcontinent prices fell to $1.38/ USG, down from $1.82/USG.
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