CHICAGO (AP) -- Falling oil prices have forced Chicago-based United Airlines to put up hundreds of millions of dollars in new collateral on fuel hedges that have turned against it.
And today, United says it's reworked a credit card agreement to reduce penalties if its cash balance falls.
Based on today's oil price of about $51 per barrel, United would have to put up some $990 million in collateral -- according to a formula for United's fuel hedges disclosed today.
Falling oil prices have stung United and other airlines because they bet that oil prices would rise. Airlines still save money because their fuel bill shrinks, but the hedging losses have forced them to take non-cash charges that could turn into cash losses if oil prices stay at current levels or fall further.
United is the dominant carrier at Denver International Airport.