Review the correlations between each of the following:

1. WTI vs Jet Fuel
2. Brent vs Jet Fuel
3. Heating oil vs Jet Fuel
4. RBOB vs Jet Fuel (briefly) 1-3 Detailed, please. Do any of these show a good correlation to determine a good hedge ratio resulting in an efficient hedge? Will have to estimate the basis risk here to develop a coefficient in the regression equation.

2012 Fuel Hedging at JetBlue Airways JetBlue-Fuel Percentage Hedged (20072012, Quarterly) Source: Created by case writer based on JetBlue Airways investor updates (2007Q12012Q3). JetBlue-Fuel Percentage Hedged (20072012, Quarterly) "Information as of 2011 Q4, at which time the hedging programs for 2012 were still not full in place Notes o Hed ged" is the percentage of fael consempton heded using derivaties for the current quarter as reported in each quarter. 2012 Fuel Hedging at JetBlue Airways Jet Fuel, Heating Oil, and Crude Oil (WTI and Brent) Spot Prices (20072011, Monthly) Jet Fuel, Heating Oil, and Crude Oil (WTI and Brent) Spot Prices (2007-2011, Monthly) Panel B: Difference in prices between Jet Fuel and crude oil (crack spread) and heating oil. 2012 Fuel Hedging at JetBlue Airways Jet Fuel, Heating Oil, WII, and Brent Crucle Oil Spot Prices, 2007-2011 (Monthly) Exhibit 6 (continued) 2012 Fuel Hedging at JetBlue Airways JetBlue-Fuel Percentage Hedged (20072012, Quarterly) Source: Created by case writer based on JetBlue Airways investor updates (2007Q12012Q3). JetBlue-Fuel Percentage Hedged (20072012, Quarterly) "Information as of 2011 Q4, at which time the hedging programs for 2012 were still not full in place Notes o Hed ged" is the percentage of fael consempton heded using derivaties for the current quarter as reported in each quarter. 2012 Fuel Hedging at JetBlue Airways Jet Fuel, Heating Oil, and Crude Oil (WTI and Brent) Spot Prices (20072011, Monthly) Jet Fuel, Heating Oil, and Crude Oil (WTI and Brent) Spot Prices (2007-2011, Monthly) Panel B: Difference in prices between Jet Fuel and crude oil (crack spread) and heating oil. 2012 Fuel Hedging at JetBlue Airways Jet Fuel, Heating Oil, WII, and Brent Crucle Oil Spot Prices, 2007-2011 (Monthly) Exhibit 6 (continued)