New Delhi, April 1 The price of aviation turbine fuel (ATF), or jet fuel, more than doubled to a record Rs 2.07 lakh per kilolitre on Wednesday, but domestic airlines will not have to pay this steep increase as a mechanism is being put in place to protect them.
Meanwhile, the price of commercial LPG was also raised by Rs 195.50 per cylinder, reflecting the surge in global oil prices linked to the ongoing conflict in West Asia.
According to state-owned fuel retailers, the price of ATF in Delhi was hiked by Rs 110,703.08 per kilolitre, or 114.5%, to Rs 207,341.22 per kl.
As ATF is a completely deregulated product, its price is based on prevailing benchmark international prices. This is according to an agreement with the airlines.
Therefore, the new rates will apply to any international airline refueling in India from Wednesday, industry sources said.
However, domestic airlines will not have to pay the steep rates, as a mechanism is being developed to ensure that they do not bear the entire burden, they said.
It is not yet known how much domestic airlines will have to pay and how much will be absorbed in some other way.
No formal announcement of the mechanism has been made so far.
This is the first time ever that the price of ATF has crossed the Rs 2 lakh per kl mark. The previous peak was in 2022, when rates were hiked to Rs 1.1 lakh per kl after oil prices surged following Russia's invasion of Ukraine.
This is the second monthly increase in rates. Prices were hiked by 5.7% (Rs 5,244.75 per kl) on March 1.
The rising prices will further strain airlines, which are already burning more fuel due to longer routes and longer flight times to Western destinations because of the airspace closures due to the war. Fuel accounts for approximately 40% of an airline's operating cost.
Meanwhile, the price of commercial LPG – used by hotels and restaurants – was also raised by Rs 195.50 per 19-kg cylinder.
A 19-kg cylinder of commercial LPG now costs Rs 2078.50 in Delhi.
The price of commercial LPG was last increased by Rs 114.5 per 19-kg cylinder on March 1.
The rates of domestic cooking gas LPG, which were last hiked by Rs 60 per 14.2-kg cylinder on March 7, remain unchanged. A 14.2-kg cylinder costs Rs 913 in Delhi.
State-owned Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum revise ATF and LPG prices on the first day of every month based on international benchmarks and the exchange rate.
Global oil prices have increased by almost 50% since the war in West Asia disrupted energy supply chains.
Petrol and diesel prices remain frozen after a Rs 2 per-litre reduction last year; petrol currently costs Rs 94.72 per litre in Delhi and diesel Rs 87.62.
