neil1234

If hedged - taking position in futures (short)
If Oil price increases—-Company Sales income increases—future posiiton loss ( futures prices also increases& we are short here) —-but home currency appreciates in $ terms (due to +ve correlation with oil)– lowering demand from US - Double whampy effect
If Oil price decreases—-Company Sales income decreases—–future posiiton profits–but home currency depreciates (due to +ve correlation ) increasing demand from US - Company is better off
But remains exposed to currency risk