Record hike of 18% in ATF prices
Oil marketing companies on Wednesday sharply raised prices of aviation turbine fuel (ATF) to record high of over INR 1 lakh per kilolitre (kl).
In a first, ATF prices were hiked by a steep 18.3% to INR 1,10,666.29 per kl in the national capital. In Kolkata, Mumbai and Chennai, jet fuel is priced at INR 1.14 lakh, INR 1.09 lakh, and INR 1.14 lakh per kilolitre, respectively. Prices are revised every fortnight.
Jet fuel prices comprise 30-40% of the cost of running an airline in India and an increase in prices will hurt profit margins of airlines which have reported huge losses over the last few quarters due to the coronavirus pandemic.
The steep increase in jet fuel prices comes in the backdrop of a surge in global crude oil prices.
Brent crude is currently at INR 102.10 per barrel, up 2.19% from its previous close.
Jet fuel prices have been hiked six times this year. Unlike ATF, petrol and diesel prices continue to remain steady for over four months now, despite increasing under-recoveries for oil market companies.