Jet fuel prices were slashed by as much as 4% on Wednesday as the international oil prices dropped sharply, offering a slight respite to airlines reeling under high costs.
The jet fuel or aviation turbine fuel (ATF) price in New Delhi stood at R51,267.36 per kilolitre, inclusive of taxes, on July 1, the oil companies said on Wednesday. The crude oil price stood at $62.84 per barrel, according to Bloomberg data.
ATF prices in other major cities stood as follows — R60,781.87 per kilolitre (Kolkata), R52,592.75 per kilolitre (Mumbai) and R56,522.06 per kilolitre (Chennai).
ATF constitutes over 40% of an airline’s operating costs and the price cut is set to reduce the financial burden on cash-strapped carriers.
Jet fuel prices have dropped sharply, by as much as 33% since January 2014. During the same period crude oil prices fell by about 42%. The fall in the fuel prices have prompted debt-laden airlines like Air India and Jet Airways to announce their turn around plans, which are expected to bear fruits in the next couple of fiscals provided the ATF prices don’t rise to their pre-January 2014 levels.
Meanwhile, airlines were not immediately available for comments on the impact of the fall in the ATF prices on passenger fares.