Delta Air Lines is buying its own oil refinery to maintain a steady flow of affordable jet fuel. It's either a brilliant move or an insane one.
The carrier says it will spend $150 million to acquire the refinery from ConocoPhillips, and then an additional $100 million fixing it up.
Richard Anderson, Delta's chief executive, called the acquisition "an innovative approach to managing our largest expense."
Jet fuel accounts for about a third of an airline's operating costs. Rising costs have resulted in higher ticket prices for travelers and more than a little turbulence for carriers.
It's possible Delta will be seen as a genius for finding a way to hedge its bets when it comes to a key commodity. But it's just as likely the company will be seen as reckless for investing millions of dollars in an industry that is itself prone to loopy boom-and-bust cycles.