“Norwegian is 85% unhedged for the next 12 months and Wizz is about 60% unhedged and I therefore much prefer our hedging position to theirs given where oil is at the moment and where it is likely to go to” Ryanair CEO Michael O’Leary told investors on a 22 October call. “We are now hedged up to 90% out to September 2019 at about $68 a barrel. That is a much stronger position than most of our competitor airlines.”
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O’Leary made these comments just before oil plunged back to $50, meaning that Ryanair may now be committed to paying $18 more than the spot price. Fortunately for Ryanair, IFRS 9 will keep the mark-to-market hedge valuation impact out of the company’s fourth quarter results. Ryanair didn’t to respond to a request for comment.
https://www.eurofinance.com/news/airlines-divided-on-hedge-benefits-as-oil-volatility-surges/