Reliance entry could see jet fuel prices fall

Mumbai: The new company that encompasses Air India and Indian (Airlines) is hoping to pare its hefty aviation fuel costs by about 10%, starting November, by opening up a supply tender, for the first time, to a private supplier: Reliance Industries Ltd.
The National Aviation Co. of India, or Nacil, is set to come out with a mega fuel tender this month to purchase jet fuel, better known as aviation turbine fuel (ATF), to meet the annual fuel needs of both Air India and Indian Airlines. And it is expecting Reliance to be a potential bidder, thanks to its newly created facilities to supply fuel at many Indian airports.
Supply of jet fuel in all of India has been the monopoly of three state-owned oil marketing companies and they typically priced the fuel at about 65% higher than it is available in many airports outside India.
This is also done because these companies then use ATF margins to cushion the impact of having to subsidize normal petrol and diesel sales.
05/10/07 P.R. Sanjai/Livemint

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Categories: Air India - International Oct 2007, Air india Budget Oct 2007, Air India Domestic Oct 2007, Air India Regional Oct 2007, General Aviation Oct 2007, NACL Oct 2007, New Oct 2007