| Hedgers such as Delta Air Lines are having a harder time managing their exposure to fuel prices as banks retreat from commodity markets. Ben Bergum, director of fuel hedging for the Atlanta-based airline, said the declining number of bank counterparties meant Delta was now relying more on cleared derivatives for its hedging transactions, forcing it to post additional margin.
"In the past six months, there has been a noticeable decline in liquidity," Bergum said during a presentation at the conference. "It has forced us to do more transactions through the cleared markets. There are still players out there that make markets – it's just that fewer of them are banks doing bilateral hedging. We are still able to do what we need to do, but it's getting more difficult."...........................................Full Article: Source
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