Oil companies decrease jet fuel price by Rs 622/kl

For the second time this month, state-owned oil companies today cut jet fuel (ATF) price by over one per cent in step with softening in the commodity's international rates.

The price of aviation turbine fuel (ATF), or jet fuel, in Delhi was cut by Rs622 per kilolitre (kl), or 1.03%, to Rs63,077 per kl with effect from midnight tonight, an official at Indian Oil Corp said.

IOC and other fuel retailers, Hindustan Petroleum and Bharat Petroleum had on December 16 reduced ATF price by 1.3% to Rs63,739.10 per kl.

Jet fuel in Mumbai will cost Rs64,054 per kl from tomorrow as against current rate of Rs 64,730.23 per kl, a decrease of over Rs676 per kl.

The reductions this month comes on back of a steep 3.7% hike in rates effected from December 1. Prior to that, ATF rates had been increased by Rs1,195 per kl from November 16 and by 3.8% or Rs2,845 per kl from November 1.

The official said the reduction was possible because fall in international jet fuel prices has offset weakening of the rupee against the US dollar.

Jet fuel makes up for 40% of an airlines' operating cost and the marginal cut in prices will slightly ease burden on the cash-strapped airlines. No immediate comment was available from airlines on the impact of the price reduction on passenger fares.

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