With the government’s decision to limit increase in jet fuel prices, domestic operational costs of aviation companies will remain under control and there will be no need to impose extra fuel surcharge. Asangba Chuba Ao, Joint Secretary, Ministry of Civil Aviation, said that with the partial increase in the prices of Aviation Turbine Fuel (ATF), airlines will readjust their prices. With this step a possible major crisis in the industry has been averted. ATF accounts for approximately 40 percent of the operational expenses of any aviation company.
Asangba said that the limited increase of 25 percent in the price of ATF for scheduled domestic aviation companies on domestic routes provides significant relief and ensures that the domestic operational costs of Indian airlines remain under control. Earlier in the day, Civil Aviation Minister K. Rammohan Naidu said that the decision taken in this regard by the public sector oil marketing companies under the Petroleum Ministry is practical and far-sighted.
how much increased
Due to the surge in global oil prices, the price of Aviation Turbine Fuel (ATF) or aviation fuel was increased to a record of more than Rs 2.07 lakh per kiloliter on Wednesday. However, public sector petroleum companies limited it to 8.5 percent for domestic aviation companies. According to public sector petroleum companies, the price of ATF for domestic airline companies has been increased by Rs 8,289.04 per kiloliter or 8.5 percent. They will get jet fuel at the price of Rs 104,927.18 per kilolitre. Last month it was Rs 96,638.14 per kilolitre.
statement from the ministry
The Petroleum Ministry said that despite international oil prices exceeding $ 100 per barrel in a month, only a partial and phased increase of 25 percent (ie Rs 15 per liter or Rs 15,000 per kilolitre) is being passed on to the airlines. The Civil Aviation Ministry also supported this figure. Sujata Sharma, Joint Secretary, Ministry of Petroleum and Natural Gas, clarified the difference between the two figures, saying that one figure reflects the final rate including all cesses and taxes, while the 25 per cent figure reflects the increase made on the base price of ATF. Sharma said in the press conference that a balanced approach has been adopted in the matter of revision of ATF prices, so that its impact is minimal.