On Wednesday, due to the fall in international crude oil prices, the prices of jet fuel or aviation turbine fuel (ATF) were reduced by about Rs 5 per liter. Government fuel companies reduced the price of ATF by Rs 5 per liter, due to which its price in Delhi became around Rs 110 per liter. This cut has been made after the softening of international oil prices in recent weeks.
This has provided relief to airlines, for whom fuel is the biggest operating expense. This change is expected to reduce the operating costs of domestic airlines, although the extent of its benefit will depend on the fuel purchasing and hedging strategies of the airlines. ATF prices are revised on the 1st of every month based on the average of international benchmark prices and the current rupee-dollar exchange rate.
Earlier on Wednesday, oil marketing companies cut the price of 19 kg commercial LPG cylinder by Rs 183.50 with effect from July 1, which was the first cut in commercial LPG rates this year. There was no change in the prices of domestic LPG cylinders. This change was made after the decline in global crude oil prices following the easing of geopolitical tensions in West Asia.
Change in export duty
Meanwhile, on Tuesday, the central government changed the export duty on petrol, diesel and aviation turbine fuel (ATF) for the fortnight starting July 1, while there was no change in the excise duty on petrol and diesel sold in the domestic market. Under the new rates, the export duty on petrol has been fixed at Rs 4 per liter, on diesel at Rs 8.5 per liter and on ATF at Rs 7.5 per liter. The changes, notified by the Finance Ministry, are part of the government’s fortnightly review of the export levy based on trends in international crude and refined fuel prices.
The scope of exemption was also extended
The export duty system was introduced earlier this year to ensure adequate domestic availability of petroleum products by discouraging exports at a time of rising global prices and geopolitical uncertainty. In this review, the scope of exemption from these duties has also been expanded for exports made by government oil companies to Nepal, Bhutan, Bangladesh and Sri Lanka, as well as to Mauritius and Maldives. These notifications have no impact on the excise duty on petrol and diesel sold in India, which means that retail fuel prices will remain the same.
