Fuelling doubts
Violence and uncertainty in the Middle East have caused energy market volatility to soar, testing the mettle of even the most sophisticated corporate hedgers. Will it prove to be the last straw for the world’s ailing airlines? Navroz Patel reports
When energy traders see violence in the Middle East unfold live on their televisions, they know to expect a burst of volatility on their trading screens. So the sharp escalation of the Israeli-Palestinian conflict at the start of the year sent savvy corporate risk managers with large energy exposures scrambling to reinforce their hedges. “We pushed our hedge ratios up significantly in January and February when we saw the overall situation in the Middle East,” says Beat Lehmann, who, as Basel
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