Delta is taking a $450m loss because jet fuel prices didn't jump as much as the airline bet they would. The airline had locked in fuel purchases, in a contract known as a hedge, at levels above the current market value, betting that jet fuel prices prices would climb. And they did indeed rise. But they didn't go nearly as high as Delta had anticipated, which made that hedge a loser. So Delta pulled out of the fuel contracts, which cost the airline nearly half a billion dollars. But it's not all bad news for Delta. Fuel prices are up 60% from their January lows, but they're down 20% from a year ago. So, even with the cost of canceling its fuel contract, Delta will save money on fuel, which is its second largest expense, in Q2. Delta took an even bigger hit on hedges last year -- $2.3b according to company filings -- as fuel prices fell throughout the year. It lost another $274m on hedges in the first three months of this year.<br/>
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Aeroflot was once synonymous with Soviet inefficiency, with its delayed departures, aging planes and rude service. Despite that legacy and a recent downturn in the Russian economy, Aeroflot has turned things around, rising in global airline-quality rankings and becoming a darling for investors. Its stock price on the ruble-traded Micex index doubled in less than a year. Good performance, however, has perils for a state-owned company. Last September, the government promoted Aeroflot’s takeover of 75% of closely held competitor Transaero Airlines, which analysts said was saddled with about 250b rubles, or roughly $3.9b, in debt. The state eventually backed off, but the abandoned Transaero deal—which Aeroflot board members said was put up for vote with little warning—underscored how exposed the carrier can be to government whims that run the gamut from mandatory purchases of Russian-made planes to below-market rates on domestic travel. When the Soviet Union existed, Aeroflot ranked as the world’s largest airline by traffic. But when the country fractured in 1991, so did the carrier. A wave of government-inspired consolidation has helped the airline regain its top status in the country. Globally, Aeroflot last year was the 22nd-largest airline by traffic, according to the International Air Transport Association. In recent years, that expansion has been accompanied by improvements. Story has further details.<br/>
China Eastern Airlines has raised CNY8.55b (US$1.28b) in a private sale of shares to a group of investors including China's biggest online travel agency Ctrip, which becomes the airline's fifth-biggest shareholder. China's second-largest carrier by passenger numbers will use CNY6.83b of the proceeds to purchase new aircraft, and CNY1.71b to repay bank loans, it said. The private placement came as China Eastern sought to diversify its shareholder pool. <br/>