Snapping a three-month trend of price cuts, state-owned oil firms today hiked the jet fuel rates by 1.7 per cent in line with firm international prices.
Prices of aviation turbine fuel (ATF) or jet fuel in Delhi were hiked by Rs 1,039.10 per kilolitre (kl) or 1.7 per cent to Rs 62,208.18, according to Indian Oil Corporation.
The hike comes on the back of reduction in rates in six fortnights, including a steep five per cent (Rs 3,260 per kl) cut effected from June 16 and about two per cent (Rs 1,241 per kl) cut effected from July 1.
Jet fuel, which had hit an all-time high of Rs 71,028.26 per kl in August 2008 shortly after international oil rates touched a record $147 per barrel, had fallen to an eight-month low of Rs 61,169.08 per kl earlier this month.
In Mumbai, jet fuel will cost Rs 63,002.45 per kl from today against Rs 61,933.58 per kl previously.
Jet fuel constitutes over 40 per cent of an airline’s operating cost and today’s increase in prices will wipe away some of the gains the cash-strapped airlines had made from reductions.
No immediate comments were available from the airlines on the impact of the price hike on passenger fares.
The three fuel retailers — IOC, Hindustan Petroleum and Bharat Petroleum — revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.