ITEM 7A. Quantitative and Qualitative Disclosures  About Market Risk PART II  ITEM 7A Quantitative and Qualitative Disclosures About Market Risk JETBLUE AIRWAYS CORPORATION  -  2013 Annual Report 39 Interest Fixed Rate Debt Aircraft fuel The risk inherent in our market risk sensitive instruments and positions is  the potential loss arising from adverse changes to the price of fuel and  interest rates as discussed below. The sensitivity analyses presented do  not consider the effects such adverse changes may have on the overall  economic activity, nor do they consider additional actions we may take  to mitigate our exposure to such changes. Variable-rate leases are not  considered market sensitive financial instruments and, therefore, are not  included in the interest rate sensitivity analysis below. Actual results may  differ. See Notes 1, 2 and 13 to our consolidated financial statements for  accounting policies and additional information. Our results of operations are affected by changes in the price and availability  of aircraft fuel. Market risk is estimated as a hypothetical 10% increase in  the December 31, 2013 cost per gallon of fuel. Based on projected 2014  fuel consumption, such an increase would result in an increase to aircraft  fuel expense of approximately $202 million in 2014. This is compared to an  estimated $190 million for 2013 measured as of December 31, 2012. As of  December 31, 2013, we had hedged approximately 9% of our projected  2014 fuel requirements. All hedge contracts existing at December 31,  2013 settle by December 31, 2014.  The financial derivative instrument agreements we have with our  counterparties may require us to fund all, or a portion of, outstanding  loss positions related to these contracts prior to their scheduled maturities.  The amount of collateral posted, if any, is periodically adjusted based on  the fair value of the hedge contracts.  On December 31, 2013, our $230 million aggregate principal amount of  convertible debt had a total estimated fair value of $431 million, based on  quoted market prices. If there were a 10% increase in stock prices, the fair  value of this debt would have been $470 million as of December 31, 2013. If interest rates average 10% lower in 2014 than they did during 2013, our  interest income from cash and investment balances would remain relatively  constant, similar to the relative constant level of interest income for 2013  measured as of December 31, 2012. These amounts are determined  by considering the impact of the hypothetical interest rates on our cash  equivalents and investment securities balances at December 31, 2013  and 2012. Our earnings are affected by changes in interest rates due to the impact  those changes have on interest expense from variable-rate debt instruments  and on interest income generated from our cash and investment balances.  The interest rate is fixed for $1.46 billion of our debt and capital lease  obligations, with the remaining $1.12 billion having floating interest rates. If  interest rates were, on average, 100 basis points higher in 2014 than they  were during 2013, our interest expense would increase by approximately  $12 million. This is determined by considering the impact of the hypothetical  change in interest rates on our variable rate debt.