New Delhi: In what could be a bonanza for the fliers, Jet fuel (ATF) rates were on Saturday cut by a steep 7.3 %. It is the fourth straight reduction in prices since August on back of falling international oil rates.
The price of aviation turbine fuel (ATF), or jet fuel, at Delhi was cut by Rs 4,987.7 per kilolitre, or 7.3 %, to Rs 62,537.93 per kl, oil companies announced on Saturday.
This is the fourth reduction in jet fuel rates since August. Rates were cut by almost 3 % or Rs 2,077.62 per kl on October 1. Declining international oil prices have made imports cheaper, resulting in price reduction.
In Mumbai, jet fuel will cost Rs 64,414.98 per kl from Saturday as against Rs 69,610.50 per kl previously. The rates vary because of differences in local sales tax or VAT.
Jet fuel constitutes over 40 % of an airline’s operating costs and the price cut will ease the financial burden of cash-strapped carriers. High levels of state taxes further add to the fuel costs.
No immediate comment was available from airlines on the impact of the price cut on passenger fares.
The three fuel retailers – IOC, Hindustan Petroleum Corp and Bharat Petroleum Corp – revise jet fuel and non-subsidised LPG prices on the first of every month, based on the average international prices in the preceding month.