Oil price

If a Qantas flight followed the airline's share price trajectory, passengers would be gripping their arm rests and if it followed the steep ascent of the oil price they would be pulling down their oxygen masks. And for airfares the only way is up.

But it won’t be enough to offset the damage from an oil price currently hovering above $US120 a barrel. And no one knows when the price of oil might peak and how high it could go before it does. But both have picked up significantly over the past three weeks and seem to be following an encouraging recovery trend. The good news is that Qantas’ fuel costs are 90 per cent hedged until June. The bad news is that this is rolling off. Nothing says financial pain for the aviation industry like an oil price shock — except maybe a two-and-a-half year viral pandemic. If a Qantas flight followed the airline’s share price trajectory, passengers would be gripping their arm rests.