Oil firms trim jet fuel prices by about 4%

New Delhi/Palakkad: Oil marketers have reduced jet fuel prices by Rs2,100 per kilolitre, equivalent to at least 3.8% of the current price, after the government scrapped basic customs duty of 5% on the fuel on Friday to stem losses of local airline firms.
“The price cut will be effective from midnight of 3 November,” an oil marketing company executive said on condition of anonymity.
The fuel will now sell at Rs44,965.70 a kilolitre in Delhi and Rs46,518.85 a kilolitre in Mumbai.
Jet fuel accounts for 45-55% of the operating costs of airlines in India. Mint had reported on the government’s move to rationalize jet fuel levies on 17 October. Oil marketers such as Indian Oil Corp. Ltd, Bharat Petroleum Corp. Ltd and Hindustan Petroleum Corp. Ltd had cut jet fuel price by Rs9,429.87 a kilolitre, or 16.6%, at the start of this fortnight.
The government had earlier agreed to a rationalization of jet fuel duties if airline firms did not lay off staff to protect profits. Airlines together expect losses of some $2 billion (Rs9,800 crore) this fiscal year to March 2009.
04/11/08 Utpal Bhaskar and P.R. Sanjai/Livemint

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Categories: Indian Aviation- In General Nov 2008