Oil marketing companies (OMCs) on Thursday slashed the price of aviation turbine fuel (ATF) by about 3%, compared with a fortnight ago, as global crude oil prices fell on fears of a slowdown in economic recovery due to a surge in number of covid-19 cases globally. This is the first time that jet fuel prices have been slashed since last October.
Jet fuel accounts for about a fourth of expenses for major domestic airlines.
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ATF prices stood at Rs58,374.16 per kilolitre (kl) in New Delhi on Monday, according to a notification by Indian Oil Corp. Ltd (IOCL).
ATF prices were raised to Rs60,261.16 per kl in New Delhi on 16 March from Rs59,400.91 per kl on 1 March. Jet fuel prices are revised every fortnight by state-run oil marketing companies, and have been on the rise since October.
As of Thursday, ATF prices in Mumbai stood at Rs56,479.02 per kl, in Chennai it was at Rs59,541.72 per kl and in Kolkata it was at Rs62,732.69 per kl.
“The ATF prices increased sequentially by 24.1% in July 2020 and by 4.2% in August 2020. However, it declined sequentially by 3.4% in September 2020 and by 5.6% in October 2020, before increasing 4.6% in November 2020, 9.1% in December 2020, 10.2% in January 2021, and 5.4% in February 2021 (as on 1 February 2021),” said Kinjal Shah, vice-president, ICRA, in a recent report.
The price of Brent crude stood at $64.08 a barrel on Thursday, a rise by 159% on an annual basis, according to Bloomberg data. However, crude prices have fallen in the last fortnight from $68.27 a barrel.