Jet fuel or ATF prices were on Thursday were cut by a steep 4.5 per cent, the first reduction in rates in six months.
ATF prices had touched a life time high of Rs 77,089.42 per kilolitre (kl) following five consecutive increases since June as rupee depreciated against the US dollar, making oil imports costlier.
However, the rupee's appreciating during last month helped trim imported cost, leading to cut in prices.
Aviation Turbine Fuel, or ATF, price at Delhi was cut by Rs 3,482.16 per kl, or 4.5 per cent, to Rs 73,607.26 per kl, according to Indian Oil Corp, the nation's largest fuel retailer.
Rupee appreciation against US dollar also led to two rounds of reduction in petrol rates in one month - Rs 3.05 a litre from October 1 and Rs 1.15 announced on Thursday.
Since June, ATF prices have gone up by a record Rs 14,439.45 or 23 per cent in five instalments.
In Mumbai, jet fuel will cost Rs 76,035.89 per kl from tomorrow as against Rs 79,716.05 per kl currently. Rates at different airports vary because of difference in local sales tax or VAT.
Jet fuel constitutes over 40 per cent of an airline's operating costs and the price cut will help bring down the fuel cost of the cash-strapped carriers.
No immediate comments were available from the airlines on the impact of the price 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.