Jet Fuel Costs Soar Amidst Global Oil Price Surge

The cost of Aviation Turbine Fuel (ATF) in India has soared to a record Rs 2.07 lakh per kilolitre on Wednesday, a reflection of the sharp surge in global oil prices over the past month. This significant hike, representing a 114.5% increase for certain carriers, is expected to impact the operational costs of airlines significantly.

While domestic airlines will encounter just an 8.5% price rise, paying about half of the Rs 2.07 lakh per kilolitre, carriers such as non-scheduled, adhoc, and charter flights face the full brunt of the hike. This calibrated adjustment comes as a strategic measure amidst the ongoing Middle East conflict that has disrupted global energy supply chains.

The global energy situation has prompted Indian state-owned oil enterprises to moderate the price rise for domestic airlines. Despite the increase in ATF costs, February's fuel price increase remains evident, leaving airlines financially strained as they navigate longer routes due to airspace closures. Air fuel, accountable for around 40% of an airline's operating expenses, exacerbates the current scenario alongside elevated LPG rates and frozen petrol and diesel prices.