Jet fuel (ATF) prices were cut on Monday by the biggest ever cut of 12 per cent, the second reduction in as many weeks on softening international oil prices amid fears of a slowdown.
Aviation Turbine Fuel (ATF) prices in the national capital have been cut by Rs 16,232.36 per kl or 11.75 per cent to Rs 121,915.57 per kl.
This is the biggest ever reduction in rates and follows the cut of Rs 3,084.94 per kiloliter (2.2 per cent) on July 16.
Parallelly, the rates of commercial LPG – which is used by hotels, restaurants and other commercial establishments – were reduced from Rs 36 to Rs 1,976.50 per 19 kg cylinder.
This is the fourth reduction in commercial LPG rates since May. Overall, the prices have come down by Rs 377.50 per 19 kg cylinder.
There has been no change in the price of LPG, a domestic cooking gas used in domestic cooking. The price of a 14.2 kg domestic LPG cylinder in the national capital is Rs 1,053.
While ATF prices are revised on 1st and 16th of every month, commercial LPG rates are revised once a month, based on the rates of benchmark international oil rates in the previous fortnight.
The price of ATF – the fuel that helps airplanes fly – soared to Rs 141,232.87 per kiloliter (Rs 141.23 per liter) on June 16, after a record 16 per cent increase in rates (Rs 19,757.13 per kilolitre).
Fears of a slowdown in major economies have softened international oil prices. Brent, the world’s most famous benchmark, was trading at $103.60 a barrel on Monday, up from $110 a barrel last week.
Apart from the two rate cuts on July 16 and August 1, ATF prices were cut by a marginal 1.3 per cent (Rs 1,563.97 per kiloliter) on June 1. But for these three curves, ATF prices have been rising throughout 2022.
Overall rates have increased 11 times since the beginning of the year. This has almost doubled the rates in six months.
The price was increased by 91 per cent (Rs 67,210.46 per kiloliter) from January 1, before two cuts in a row.
With jet fuel making up about 40 percent of an airline’s operating cost, the cost of flying was increased as a result of the price increase. Now there is some relief for the airlines.
Meanwhile, petrol and diesel prices remained unchanged at Rs 96.72 per liter and Rs 89.62 per liter respectively.
The cut in excise duty by the government had helped reduce the price of petrol by Rs 8.69 per liter and diesel by Rs 7.05 per liter on May 22. But the base price for the same has remained unchanged from April 6.
Earlier, the prices were hiked by a record Rs 10 per litre.
The retail prices of petrol, diesel and domestic cooking gas are much below the cost. Rates of petrol and diesel are revised daily on the basis of similar rates in the international market.