Oil marketing companies cut ATF prices by 4.3%
MDT/PTI 01 October 2012

Jet fuel constitutes over 40% of an airline’s operating costs and the reduction in prices will ease burden of the cash-strapped airlines

New Delhi: In a major relief to cash-strapped airlines, jet fuel (ATF) prices were on Monday cut by a steep 4.3%, the first reduction in rates in three-and-a-half months, reports PTI.

 

ATF (air turbine fuel) at T3 terminal in Delhi has been reduced by Rs3,195 per kilolitre (kl), or 4.33%, to Rs70,516 per kl from Monday, according to Indian Oil Corporation (IOC), the nation’s largest fuel retailer.

 

The reduction, triggered by firming rupee against the US dollar, comes on back of five rounds rate hikes since July.

 

In Mumbai, jet fuel will cost Rs70,950 per kl as against Rs74,332.47 per kl previously.

 

Monday's reduction is a shade lesser than Rs3,260 per kl, or 5%, cut effected from 16 June 2012.

 

Jet fuel constitutes over 40% of an airline’s operating costs and the reduction in prices will ease burden of the cash-strapped airlines.

 

No immediate comments were available from the airlines on the impact of the price cut on passenger fares.

 

The three fuel retailers—IOC, Hindustan Petroleum and Bharat Petroleum—revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.

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