Eric Johnson

The cost of iron ore has actually gone up.

So in that, the spot market on iron ore.

So they're actually making more money back than what they're paying out in high diesel costs.

Yeah.

So look, out of that, in terms of managing it better, again, no simple answer.

Depends on how it plays out.

Now, in a real binary answer, Virgin for now, Virgin Airlines, a smaller one, is managing it better.

Why?

Because it's a smaller airline.

It's mostly domestic focused.

So its planes, they don't have to travel those ultra long distances of getting people overseas.

It has flexible pricing.

But before it went to a float last year in an ASX listing, it took in comprehensive information

fuel hedging strategies so it's like taking out insurance so it really doubled down so not only it hedged against the brent crude price but it also hedged against the additional margin of the aviation fuel now that that's the really expensive stuff that's gone up aviation fuel so not only has brent crude we've seen

It's now tracking at about $120 a barrel.

That's US.

Aviation fuel has actually almost doubled over that same period.

Yeah, right.

Because the refining process of it is obviously costly.

The demand process is quite large.