Deadlock over, oil firms agree to continue fuel supply to Air India

The PSU oil companies, which had stopped cash and carryterms to the national flag carrier on Friday morning, resumed the system.

AI chief communications officer Kamaljeet Rattan said thegovernment owed the airline Rs 450 crore for its services. He said the airlinewould clear the oil companies' dues on the receipt of this amount.

The oil companies had started the cash and carry termsearlier this year. Air India,like other private carriers, owes huge amounts to the oil companies. Itscombined liability under the fuel head stood at Rs 1,200 crore.

Their decision to do away with the cash and carry terms hadresulted into cancellation of five flights from Thiruvananthapuram, includingan international flight to Riyadhearlier in the day.