American Airlines and merger partner US Airways could enjoy more than $2.5 billion in "tailwinds" in 2015 because Philadelphia's dominant airline does not hedge its jet-fuel costs and does not have profit-sharing with employees, a Wall Street analyst said Friday.

American is one of the few major airlines that does not buy hedges, which are futures contracts that lock in fuel prices in advance.

Declining oil prices should be worth at least $1.3 billion to American, airline analyst Hunter Keay of Wolfe Research L.L.C. said in a note to clients.

Keay said American would pay 30 cents a gallon less in fuel this year than Delta Air Lines and United Airlines, which hedge a portion of their fuel needs to reduce the effect of volatile crude prices.

American should pocket an additional $1.2 billion because it does not have profit-sharing plans with employees, Keay wrote.

"Jet-fuel costs are about half of what they were a year ago," said Tom Kloza, chief analyst for the Oil Price Information Service, "and the prospects are for prices to continue to be 35 percent to 40 percent cheaper than last year."

Hedging among airlines has been on the decline, Kloza said. "Most of them have quietly pulled back on hedging in the last few years." Kloza finds it "reprehensible" that lower jet-fuel prices have not translated into lower airfares for consumers.

Jet-fuel prices are about $1.60 a gallon vs. $3 a gallon last winter, he said. "Airlines are tremendous beneficiaries of these low prices, and we've yet to see any evidence that it's going to be passed along to the public, like with diesel and gasoline, propane, and every other hydrocarbon."

Kloza predicts crude oil prices may drop below $40 a barrel in 2015, but could rebound and approach $80 a barrel. "You are talking about a ceiling that's lower than the floors that you've seen in the last three years."

While airlines buy some fuel through hedge contracts, they purchase most of their fuel requirements at market prices.

"Yes, there will be paper losses" if hedge contracts turn out to be more costly than current prices, Kloza said, "but the airlines are wonderful beneficiaries of lower oil. Virtually no airline hedges 100 percent."

For example, Delta said it kept about 65 percent of savings for every $1 drop in oil price, the investment research website SeekingAlpha.com recently noted.  Southwest Airlines forecast it would reap 80 cents in savings for every $1 drop in oil prices, wrote Clark Schultz, a SeekingAlpha news editor.

However, both airlines said they faced potential payments of hundreds of millions of dollars if the price remained low when certain contracts were due.

"Other airliners could also have some hedging exposure, although details are light on the strategies employed," Schultz noted. American will receive the full benefit of lower fuel prices because it does not hedge.

"The type of hedging strategies used by airliners," Schultz wrote, "will play a big part in profitability in the sector."

215-854-2831