This is the second straight increase in jet fuel rates in as many months.
After three consecutive hikes, state-run oil companies on Thursday reduced jet fuel or ATF prices marginally by about one per cent in tandem with international rates for the same.Indian Oil, Bharat Petroleum and Hindustan Petroleum cut aviation turbine fuel (ATF) price by Rs 311 per kilolitre in Delhi to Rs 31,615 per kl with effect from midnight tonight, an IOC official said.
In a bid to slash costs, Air India has hedged 10,000 barrels of jet fuel for its aircraft this month, four weeks after its Board gave a nod to the move.
Falling jet fuel prices, stable rupee signal lower losses
Kardassis, who quit the airline in 2013, will advise Goyal and senior management on cost-saving and productivity improvement
Air travel became costlier on Tuesday with major Indian carriers hiking fuel surcharge on tickets, ranging from Rs 150 to Rs 250 for domestic travel and $15 (Rs 825) for a one-way international ticket, following an almost eight per cent increase in jet fuel prices.
It is the seventh reduction in jet fuel rates since August
Public sector oil firms on Thursday raised aviation turbine fuel (jet fuel) prices by up to 2 per cent, the second increase in three months.
Jet Airways, SpiceJet, Kingfisher and other airlines have told the government that they would curtail services frequency and air routes to cut losses after oil companies raised the prices of aviation fuel.
Air India on Thursday increased the fuel surcharge component in fares on several routes.
Though June-quarter performance was impressive, fuel price hikes and falling demand pose fresh challenges for the company.
Brent crude oil price surged 4 per cent on Friday, following tension between Iran and the US. Airlines, however, have been unable to pass on the price increase to customers due to the soft demand.
Domestic fares on all sectors became costlier by Rs 200 from Friday with the hike in fuel surcharge, imposed by major airlines due to increase in jet fuel prices.
Rising crude oil prices and muted passenger traffic in the July-September quarter (second quarter, or Q2) of 2023-24 (FY24) have raised concerns about the profitability of listed aviation players. These two concerns have caused the stock of InterGlobe Aviation (IndiGo), the largest player in the sector, to slip by 11 per cent since its highs at the end of July. Nuvama Research expects yields to cool down in the near term due to seasonality, rising crude oil prices, and higher capacity.
India's fuel sales surged past pre-pandemic levels in March on twin impact of the economy rebounding from the lifting of pandemic-related restrictions and anticipation of price increases leading to stocking. In the first two weeks of March, dealers, as well as the public, topped up their tanks in anticipation of an increase in prices that had been on hold in the run-up to the elections in states like Uttar Pradesh. While daily price revisions restarted on March 22, the increases were calibrated.
Budget air-carrier, SpiceJet, expects to break-even this fiscal, a top company official said. The break-even could come on the back of stabilising fuel prices and an increasing demand for low-fare travel, he said. The air-carrier expects oil prices to stablise in the range of $65-70.
Concerned over high service tax substantially raising air ticket prices, Civil Aviation Minister Ajit Singh has urged Finance Minister Pranab Mukherjee to revert to the earlier rates which were capped at Rs 100 and Rs 500 per domestic and international ticket.
IndiGo operates 125 flights across 17 destinations with a fleet of 19 brand new Airbus A-320 aircraft. For the full service carrier, Kingfisher, the drop on flights up to 750 km will be Rs 400 to Rs 1,950 from Rs 2,350 earlier. Fares for travelling above 750 km will be down to Rs 2,700 from Rs 3,100.
LPG rates were last hiked on November 1 by Rs 2.05 per cylinder. Prior to that rate was hiked on October 28 by Rs 1.5 per cylinder on account of hike in commission paid to dealers.
In a much-needed relief to cash-strapped airlines, this is the second straight monthly reduction in rates and the biggest single cut ever.
Despite the increase, at Rs 64.32 per litre ATF costs less than petrol and diesel.
Jet Air shares rally on expectations that continuing troubles at rival SpiceJet will help it gain market share.
SpiceJet had bet its fortunes heavily on the new version of the 737 of which it has 13 planes in its fleet and another 193 aircraft on order
Domestic air passenger traffic touched 1.25 crore in January this year, an increase of 96 per cent compared to the year-ago period, according to rating agency Icra. However, it said the traffic remained around 2 per cent lower compared to the pre-Covid levels -- January 2020. The traffic stood at 64 lakh in January last year. Icra is maintaining a negative outlook on the Indian aviation industry, reflecting the view that the financial performance of Indian airlines is likely to remain under pressure in the near term, even though the recovery in domestic passenger traffic has been healthy.
Jet Airways, part-owned by Abu Dhabi's Etihad, reported its biggest-ever quarterly loss as costs jumped and it took a charge on its investment in a subsidiary.
Petroleum and oil marketing companies raised the price of commercial liquid petroleum gas (LPG) cylinders by Rs 350.50 per unit and domestic LPG cylinders by Rs 50 per unit with immediate effect from Wednesday.
Jet Airways said on Thursday it will increase fuel surcharge by Rs 150 on both Club Premiere and Economy Class tickets on domestic routes, with effect from May 4.
State-owned oil marketing companies have cut the prices of aviation turbine fuel, or jet fuel, by 12 per cent from midnight tonight - the first fortnightly price revision.
The GST Council on Saturday postponed a decision on cutting tax rate on life and health insurance premiums, officials said. The 55th meeting of the GST Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state counterparts, decided that some more technicalities needed to be ironed out and tasked the GoM for further deliberations.
Sources aware of the development said as part of the project, the airline had signed an agreement with Reliance Industries Ltd, which would extend quality control services at its coastal terminals for ATF imported by the airline.
India will require 1,740 planes over the next 20 years.
High fuel prices are not only taking a toll on airline companies' balance sheets, but also forcing them to innovate to cut costs.
In a major relief to cash-strapped airlines, jet fuel (ATF) prices were on Monday cut by a steep 4.3 per cent, the first reduction in rates in three-and-a-half months.
Capa lauded govt's efforts in rescuing SpiceJet.
In a meeting with stakeholders last week, the authority mooted setting up a Special Purpose Vehicle along with airlines and state-owned oil marketing companies to develop common infrastructure to import ATF, among others, at Chennai and Kolkata airports. While AAI and OMCs will hold 76 per cent in the proposed SPV, the airlines will participate in the remaining 24 per cent equity.
If that happens, Jet Airways will be the first bankrupt airline which will be revived under the Insolvency process.
Pakistan was ready to buy petroleum products from India if these were offered at "right prices", the country's minister of Petroleum and Natural Resources Asim Hussain said.
Jet Airways on followed its smaller rival SpiceJet and hiked fares by a steep 25 per cent to mitigate the impact of the sharp fall in the rupee value and a near 15 per cent spike in oil prices of late.
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