Airfares likely to increase soon due to Aviation Turbine Fuel price hike

Oil marketing companies have hiked the aviation turbine fuel (ATF) price by a steep 7.6 per cent, sending ATF price to an all-time high of Rs 72,282 per kilolitre

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Airfares are likely to rise soon with Indian carriers mulling hiking fuel surcharge on tickets following a steep increase in jet fuel prices.

"We are studying the impact of a steep hike of aviation turbine fuel prices on our operational costs which are high in any case. We are studying the situation and may take a decision soon," an airline official said, requesting anonymity. 

Oil marketing companies had yesterday hiked the aviation turbine fuel (ATF) price by a steep 7.6 per cent, sending ATF price to an all-time high of Rs 72,282 per kilolitre.

It is the fourth straight increase in rates since July. Jet fuel constitutes almost half of an airline's operating costs, compared to 20-25 per cent globally, due to high taxes on ATF by the state -- ranging from four per cent to 30 per cent.

Though international airlines operating to India are exempted from state-level taxes they also pay nearly 16 per cent more than the global average.

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