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Q.1 Given the high price of jet fuel at the end of 2011 (refer to figure 1), should JetBlue hedge its fuel costs for 2012?

Q.1 Given the high price of jet fuel at the end of 2011 (refer to figure 1), should JetBlue hedge its fuel costs for 2012? And, if so, should it increase or decrease the percentage hedged for 2012? Provide your reason with a brief explanation.

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Figure 1: Historical Monthly Price Changes in the last 60 months in Jet Fuel spots and Price changes in Traded Oil Futures (WTI crude oil, Brent crude oil) Figure 1: Historical Monthly Price Changes in the last 60 months in Jet Fuel spots and Price changes in Traded Oil Futures (WTI crude oil, Brent crude oil)

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