Aviation fuel prices cut by 5.3%

Written by Press Trust of India | New Delhi | Updated: May 2 2013, 06:49am hrs
Jet fuel (ATF) prices were on Wednesday cut by 5.3%, the second steep reduction in rates in one month.

Aviation turbine fuel (ATF) price at Delhi was cut by R3,545.94 per kilolitre (kl), or 5.35%, to R62,649.95 per kl, according to Indian Oil Corp, the nation's largest fuel retailer.

The cut in rate, made possible due to declining international oil prices, came on back of a 5.5% (R3,884.98 per kl) cut in rates from April 1.

Softening of international oil prices had on Tuesday led to a R3 per litre reduction in petrol rates and R54.26 per cylinder cut in price of non-subsidised domestic cooking gas price.

The two rounds of cut in prices follow a 2% (R1,324.84 per kl) increase in price from February 1 and a 3.8% (R2,519.83 per kl) hike in rates from March 1.

In Mumbai, jet fuel will cost R64,624.69 per kl against R68,331.91 per kl previously.

Rates at different airports vary because of differential in local sales tax or VAT.

Kolkata would see price cut of R3657.88 to R72,514.02 per kl, while it will cost R68,191.73 in Chennai as against R71,986.32 per kl previously. Jet fuel constitutes over 40% of an airline's operating costs and the reduction in prices will ease the burden of the cash-strapped airlines.

No immediate comments were available from the airlines on the impact of the price reduction on passenger fares. The three fuel retailers IOC, HPCL and BPCL revise jet fuel prices on first of every month, based on average global price in the preceding month.