Nov. 26 (Bloomberg) -- China Eastern Airlines Corp.’s losses from wrong-way bets on fuel costs jumped sixfold in a month because of falling prices.

The fair-value loss on hedging contracts was 1.83 billion yuan ($268 million) as of Oct. 31, the nation’s third-largest carrier said in a Shanghai stock exchange statement today. That compares with 270.8 million yuan a month earlier.

China Eastern, Air China Ltd. and Cathay Pacific Airways Ltd. have all posted paper losses from hedging because the price of jet-fuel has plunged 62 percent from a July 3 high. Carriers agreed to hedging deals because fuel prices doubled in a year to hit the record. The contracts safeguarded them against the risk of further price increases.

China Eastern’s hedging volume comprised 36 percent of its estimated fuel consumption for this year, the statement said.

Air China, the nation’s largest international carrier, said the fair-value losses on its hedging contracts tripled to 3.1 billion yuan as of Oct. 31. Cathay Pacific, Hong Kong’s biggest carrier, estimated its losses at HK$2.8 billion ($359 million) as of the same date.

The price of jet fuel fell 2.5 percent to $69.05 a barrel in Singapore trading today. That compares with the July 3 record of $181.85. The carriers will recoup some of the hedging losses if the prices rises again.

China Eastern climbed 15 percent to 75 Hong Kong cents in the city today. The stock has lost 90 percent this year. In Shanghai, the airline closed unchanged at 3.93. The mainland stock will be suspended from tomorrow.

China controls the price of fuel used on internal flights. Airlines have to pay international market prices for overseas services.

China Eastern carries about 35 percent of its traffic on international routes. Around half of Air China’s passenger- revenue kilometers are from overseas services. The figure for China Southern Airlines Co., the nation’s largest carrier, is less than 20 percent.

To contact the reporter on this story: Irene Shen in Shanghai at ishen4@bloomberg.net

Last Updated: November 26, 2008 09:16 EST