Softening in global oil prices may lead to a cut in aviation turbine fuel prices next month but domestic airlines are unlikely to pass on the benefit to passengers.
Jet Airways, Kingfisher, SpiceJet and Indigo indicated that passengers would not benefit from the reduction in ATF prices saying air fares do not fully reflect the recent surge in fuel prices.
The basket of crude oil India buys, which averaged $132.47 a barrel in July, has slid to $113.52 per barrel this month and if the trend continues it may translate into lower ATF prices when they are revised at the end of the month.
State-run Indian Oil, Bharat Petroleum and Hindustan Petroleum revise ATF prices on first of every month.
"We don't pass on the entire burden onto the consumers every time the ATF prices go up. So it is highly unlikely that we will reduce the airfares this month but it also depends on the quantum of ATF price reduction," a Kingfisher Airlines spokesperson said.
These views were mirrored by SpiceJet, when its Chief Commercial Officer Samyukth Sridharan said, "Even if ATF prices are reduced, we will hold on to the current fares for a month. If the prices come down next month also, then we will reduce the fares."