Aviation Turbine Fuel (ATF) or jet fuel price has been slashed by a whopping 11.7 per cent. Non-subsidised cooking gas, LPG, has also been made cheaper by Rs 25.50 per cylinder in line with dip in international oil prices.
ATF price in Delhi was cut by Rs 5,469.12 per kilolitre (kl) to Rs 40,938.24 per kl, oil companies announced on Tuesday.
This is one of the steepest reductions in aviation fuel price. The biggest cut was on January 1 this year which saw a drop of Rs 7,520 per kl, or a down by 12.5 per cent.
Prior to today’s reduction, jet fuel saw a cut of 9.4 per cent on August 1 when it dropped to Rs 46,407.36. On July 1 ATF was priced at Rs 51,267.36 per kl.
Rates are said to vary at different airports because of a difference in local sales tax or Value Added Tax (VAT).
Jet fuel constitutes over 40 per cent of an airline’s operating costs and the price cut will reduce the financial burden on the cash-strapped carriers. Some carriers may pass on the benefit to customers by reducing passenger fares.
The oil firms have also cut prices of non- subsidised LPG, which consumers buy after exhausting their quota of subsidised cooking fuel. So now a 14.2-kg cylinder will cost Rs 25.50 less. Non-subsidised cooking gas price in Delhi has been cut to Rs 559.50 per cylinder as compared to Rs 585 previously.
Non-subsidised LPG rates were last cut by Rs 23.50 on August 1. Before that on July 1 the price of non-subsidised was cut by Rs 18 per cylinder.
The three fuel retailers – IOC, Hindustan Petroleum and Bharat Petroleum – revise jet fuel prices and non-subsidised LPG rates on the first day of every month, based on the average international price in the preceding month.
(With inputs from PTI)