Aviation Turbine Fuel Price Hiked by 8.5% to All-Time High

The hike in ATF is likely to reflect in the cost of air tickets soon as a share of the air ticket price goes into aviation fuel tax. The airlines are yet to announce ticket price hikes.

Highlights:

  • The new price in Delhi is Rs 86308.16 per kilolitre (kl).
  • ATF price was hiked for the third time in 2022.
  • The aviation turbine fuel price hike will severely impact the already struggling balance sheets of airlines.

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Aviation Turbine

In another hit to the Indian aviation industry, the Government of India has hiked the price of Aviation Turbine Fuel (ATF) by 8.5% effective from today. Indian Oil Corporation (IOC) has also announced a price increase in the ATF following the government announcement. The new price in Delhi is Rs 86308.16 per kilolitre (kl), an increase by Rs 6743 per kl.

This is the third time in the year that the price of ATF was hiked, and also the highest price so far. The previous high price range came in August 2008, which stood at Rs 81,028.26 per kl.

The hike in ATF is likely to reflect in the cost of air tickets soon as a share of the air ticket price goes into aviation fuel tax. However, the airlines are yet to make any formal announcement about increasing the air ticket cost.

Rates were hiked by 2.75% and reached Rs 76,062.04 per kl on January 1. The next hike came on January 16, when it was increased by 4.25% to Rs 79,294.91/kl. The Jet fuel prices are amended on the 1st and 16th of every month based on the average cost of the international benchmark in the preceding fortnight. Brent crude oil on February 1 was trading at $91.21 per barrel.

In December 2021, the aviation industry saw two rounds of price cuts for aviation turbine fuel, subsequent to the reduction in international oil prices. ATF price had last peaked to Rs 80,835.04 per kl in mid-November 2021, before it was reduced on December 1 and 15 by a total of Rs 6,812.25 per kl or 8.4%. Thereafter, international rates increased, leading to a hike in ATF prices.

Interestingly, the price hike came ahead of Union Budget 2022. The aviation turbine fuel price hike will severely impact the already struggling balance sheets of airlines.

Petrol and Diesel Rates Remain Unchanged

Unlike ATF, petrol and diesel rates are revised daily after taking the average price in the preceding fortnight. But prices had remained unchanged since November 4, 2021, when the central government had cut excise duty on petrol by Rs 5 per litre and that on diesel by Rs 10 a litre.

Reported By

Reporter

Ria is a lead news writer at Aviation Scoop. She writes from dawn to dusk, reads in the evenings, and draws at some ungodly hours. She loathes human interaction and finds solace in the sweet, musky smell of old books, and rain.

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