After two consecutive price hikes, state-owned oil companies today cut jet fuel prices marginally by 0.5% in line with softening in global oil rates.
The price aviation turbine fuel (ATF), or jet fuel, at Delhi's T3 airport was cut by Rs 325 per kilolitre (kl), or 0.5%, to Rs 58,271 per kl with effect from midnight tonight, an official of Indian Oil Corp (IOC), said.
The nation's largest fuel retailer, IOC, and other state retailers, Hindustan Petroleum and Bharat Petroleum, had on October 1 and September 16 and raised jet fuel prices by 2.5% and 1.5% respectively, mainly because imports had become costlier due to fall in rupee against the US dollar.
ATF in Mumbai, home to the nation's busiest airport, will cost Rs 338 per kl more at Rs 59,021 per kl from tomorrow as against the old price of Rs 59,359 per kl.
Jet fuel makes up for 40% of an airlines' operating cost and the margin cut in prices will bring some relief to the cash-strapped airlines. No immediate comment was available from airlines on the impact of the price cut on passenger fares.
ATF prices vary from airport to airport, depending on the local sales tax or VAT.
The three fuel retailers revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.