Delta and Northwest Lose $10.5 Billion Combined

Both Delta Airlines and Northwest posted significant losses due to a sharp increase in fuel costs. $6.1 billion of Delta's total loss of $6.39 billion was due to a non-cash charge related to accounting for its exit from Chapter 11. Northwest Airlines lost $4.1 billion. What I've noticed recently is that there is an interesting negative correlation between the price of crude oil and the amount of losses at airlines. Crude oil goes up, airlines lose more money. Has anyone else noticed this curious phenomenon? In all fairness, both companies do hedge a portion of their fuel consumption, but sky-rocketing fuel costs really hurt their bottom-lines.

I am certainly not an expert on the airlines, but I have always found it hard to stomach the idea of investing in an industry that seems to go into bankruptcy every few years. Despite a history littered with former carriers forced out of business, new "discount" carriers pop up out of nowhere to try to steal market share, thus causing everyone to lose money again until they are on the brink of bankruptcy again. Airlines have so many complicated and expensive issues to deal with such as labor, maintenance, and safety. This doesn't even take into account the fact that terrorists like to use planes to advance their horrifying agendas. In summary, the airline industry is tough. Will the merger of two of the largest airlines (Delta and Northwest) really help alleviate any of these problems? It may help them stay in business a bit longer, delaying the next round of bankruptcies for at least another couple of years.