Emirates writes down Dh1.5bn in fuel hedge losses

Emirates Airline wrote down fuel-hedging losses of Dh1.57 billion (US$428 million) for its fiscal year ending in March after it signed large fuel contracts before the global economic crisis sent oil prices tumbling, according to its annual report.

The higher fuel costs contributed to the carrier posting an 80 per cent drop in profits to Dh982m compared with the previous year.

The Dubai airline joins the list of carriers, including Singapore Airlines and British Airways, which took big bets predicting oil prices would continue to rise at a time when prices were climbing to a record $147 a barrel last July. That bet turned sour when spot prices began to decline to below $40 a few months later.
“Oil price movements in 2008 caught out many energy consumers off guard, including Emirates,” the carrier said in the report.