Business Today

After petrol price cut, jet fuel prices cut by 5.3 per cent

Jet fuel (or aviation turbine fuel) prices were cut by 5.3 per cent, the second steep reduction in rates in one month.

BT Online Bureau | May 1, 2013 | Updated 20:53 IST

Jet fuel (or aviation turbine fuel) prices were on Wednesday cut by 5.3 per cent, the second steep reduction in rates in one month.

The reduction in rate, made possible due to declining international oil prices, came at back of a 5.5 per cent (Rs 3,884.98 per kl) cut in rates from April 1.

Softening of international prices had on Tuesday led to a Rs 3 per litre reduction in petrol rates and Rs 54.26 per cylinder cut in price of non-subsidised domestic cooking gas price.

India's largest fuel retailer Indian Oil Corporation (IOC) said ATF price in Delhi was cut by Rs 3,545.94 per kilolitre (kl), or 5.35 per cent, to Rs 62,649.95 per kl.

In Mumbai, jet fuel will cost Rs 64,624.69 per kl as against Rs 68,331.91 per kl previously. Kolkata would see price cut of Rs 3657.88 to Rs 72,514.02 per kl, while it will cost Rs 68,191.73 in Chennai, against Rs 71,986.32 per kl previously.

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

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

Jet fuel constitutes over 40 per cent 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 reduction on passenger fares.

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

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