10:51 PM

Can the U.S. Airline
Industry Stop
the Bleeding?

In a recent story on aviationweek.com, writer Joseph C. Anselmo squarely hits nail on head when describing the current state of financial affairs in our airline sector:

"It's turning into carnage."
There can be no disputing the fact that the worldwide oil barons that refine Jet A are screwing the airlines – and the public – for all they can get. With the possible exception of the Amish buggy drivers, not one single American is exempt from this brutalization. While we GA airplane owners are being hit hard, it is impossible for us to comprehend what the airlines must be going through. Aviationweek's Anselmo again:
"To grasp the magnitude of the impact high oil prices are having on the airline industry, consider two numbers: $3.8 billion and $18 billion. The first figure is the collective profit turned by U.S. carriers in 2007. The second is the increased fuel bill those airlines will face this year. The latest spike in jet fuel prices from $2.50 a gallon in February to nearly $4 has airlines hunkered down in survival mode and resorting to desperate measures; American Airlines announced this week it will begin charging $15 to check a bag. US Airways is eliminating free snacks from its domestic flights. But those moves are symbolic drops in the bucket compared with the billions of dollars needed to cover higher fuel costs."
I have a newsflash that the airlines already know: Eliminating the stale pretzels won't save you. But what might save you is the following, something that erupted tonight from the meadow of fertility I find lurking in the right side of my brain:
There is not much that the airlines can do about $130 a barrel crude. As long as the airlines are being robbed at gunpoint by Big Oil who seem to have no ethical problem at all reaping record profits, we will continue to see the carriers teeter on the brink of extinction. So what the airlines need to do is eliminate the "middle man" and thus eliminate their hefty price mark-up. To do that, the airlines need to start brewing up their own Jet A in an airline/GA-owned refinery system operated by a collective of airline managers and business aviation representatives.
A crazy idea? Yes, of course it is, or they would have done it by now. I do not claim to be a Petrochemical Engineer, so I have no clue how much money it takes to build a refinery or how many gallons of Jet A you can squeeze from a barrel of crude. If you're taking me seriously on this, you must not read this blog very often. All I do here is throw things out there in theory to get people talking.

If the oil companies were also just scraping along like the rest of us, we could blame this near-catastrophic collapse of our airline fuel supply on OPEC, the Saudis or even Bushie. But the very fact that the current refiners of Jet A are wallowing in a sea of cash ought to suggest to even a first-year business student that they are buying low and selling as high as they can until someone with sufficient balls comes along and tells them otherwise.

Will we see a day when the airlines make their own fuel? I doubt it, since I could find no mention of any such fantasy idea out there. But if crude prices keep climbing the way they have in 2008 towards what some predict will be $200 a barrel, it will mean the airlines as we know them today will have to find a different fuel for their jets or risk disappearing altogether from our skies:
Could the saviour of the airlines be biofuel? To stay alive in a world gone mad on its oil addiction, maybe the Bigs need to seriously consider rounding up a gaggle of engineers tasked with developing a jet fuel made from something we have lots of, but is not food. That substance needs to be in such plentiful supply to produce the millions of gallons of Jet A we need. And trust me, if I knew what that substance was, I'd be wealthy beyond belief.
Without question though, the one constant we all know to be true deep in our gut is this: The days of burning fossilized dinosaurs is coming to an end. The sooner this planet gets that memo, the better.

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