Description

So Ryanair lost on its oil price hedge but this was offset by a gain on its currency hedge.

The recent past is littered with examples of airlines that have lost significant amounts on hedging out their fuel price risk. The article by Rivers (2012), available below as core reading, describes many of these causalities.

This has led many to question whether hedging really adds value for an airline.

Please address the following questions:

What are the arguments for and against an airline company hedging its fuel risk?

Based on this, would Ryanair continue on hedging its fuel price risk?Explain

Write a maximum of 750 words answering the questions above