Oil PSUs announced that the aviation turbine fuel (ATF) for April has increased by about 115% for domestic flights due to the US-Israeli war with Iran.
Air travellers are set for a major hike in airfares, as jet fuel prices increased for April as the global economy reels from the fallout of the Iran conflict, though not as steeply as earlier reported. Oil PSUs on Wednesday announced that the aviation turbine fuel (ATF) for April has increased by about 8.5% for domestic flights, as compared to about 115% as earlier reported.
IndianOil issued a clarification, revising earlier estimation of ATF prices at over Rs 2 lakh per kilolitre in Delhi to significantly lower rates. The current price of jet fuel stands at around Rs 1.04 lakh per KL. The confusion came amid heightened volatility in global energy markets due to the ongoing Iran-US-Israel conflict.
The move comes as the rupee has been under heavy pressure, which has put further pressure on Indian airlines. Due to the ongoing tensions in West Asia and fears of disruption in global oil supplies, investors have been pulling money out of Indian markets.
Domestic ATF pricing
A kilo litre (1,000 litres) of fuel in India’s busiest Indira Gandhi International Airport (IGIA) will now cost Rs Rs 1,04,927, as compared to Rs 96,638.14 last month, for domestic flights. India’s second busiest hub, Mumbai’s Chhatrapati Shivaji Maharaj International Airport (CSMIA), will see the price from Rs 90,451.87 last month to Rs Rs 98,247 in April. In Kolkata, the fuel would cost Rs 1,09,450 per KL, and in Chennai it is Rs 1,09,873 per KL.
Meanwhile, Civil Aviation Minister Ram Mohan Naidu said the PSU oil marketing companies will implement a partial and staggered increase of 25% (Rs 15/litre) for domestic airlines, while ensuring that foreign routes bear the full market-aligned price. He said this approach will help shield passengers from sharp fare increases, ease the burden on domestic airlines, and support the continued stability of the aviation sector at this crucial juncture.
Naidu also urged states to consider reducing Value Added Tax (VAT) on jet fuel to ease the burden on airlines and passengers. Discussions are underway with state governments to explore possible relief measures.