Flying into a storm

Extreme volatility in oil markets has caused hundreds of millions of dollars in losses on airline fuel hedges. At the same time, burgeoning margin calls have forced some to get creative with collateral agreements. How is the airline industry adapting? By Matt Cameron

A irlines across the globe have had a year they would rather forget. The financial crisis has taken a heavy toll, with many companies reporting severe drops in domestic ticket sales as holiday and business travellers cut back on spending, while cargo traffic has also declined precipitously. To add to their woes, ticket sales declined further this year as the swine flu pandemic swept across the globe - and analysts estimate global air traffic in terms of passenger kilometres travelled will