Airfares Likely to Rise with Steep Jump in Jet Fuel Price

Airfares are expected to rise with the steep increase in jet fuel prices amid the ongoing West Asia conflict. 

The price of Aviation Turbine Fuel (ATF) has more than doubled to a record Rs 2.07 lakh per kilolitre on Wednesday, and this is the first time that the jet fuel price has crossed the Rs 2 lakh per kilolitre mark. 

In Delhi, ATF price has been hiked by Rs 1,10,703.08 per kilolitre, or 114.5 per cent, to Rs 2,07,341.22 per kl, according to state-owned fuel retailers. Officials said airfares are expected to rise as airlines would have to increase fares to



cover the higher operational costs.

There were no immediate comments from airlines on the impact of the ATF price hike on the airfares. The steep price hike would add to the spiralling operational costs of airlines, which are already facing headwinds due to the West Asia conflict that started on February 28. 

ATF accounts for around 40 per cent of an airline's operational costs. State-owned Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum revise ATF and LPG prices on the first day of every month based on international benchmarks and the exchange rate.