ATF hike may undo airlines' austerity gains

Bangalore: High jet fuel costs are back to haunt airline companies, just when they appeared to have left the turbulence behind with some deft manoeuvring on the costs front and help from falling crude oil prices.
With crude oil prices headed north again, state-owned oil marketing companies (OMCs) Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp on Sunday hiked aviation turbine fuel (ATF) prices by around 2.4%.
With this, ATF prices will increase by Rs 948 to Rs 40,423 per kilolitre (KL) in New Delhi effective Sunday midnight.
In Mumbai, home to nation's busiest airport, ATF price will go up by Rs 988 to Rs 41,710 per KL.
This is the second time the OMCs have increased ATF prices this month.On November 1, the companies had raised jet fuel prices 9%.
The three oil PSUs revise jet fuel prices on the first and the 16th of every month based on the average global oil price in the previous fortnight.
Domestic airlines have already increased fuel surcharges by around Rs 200 after ATF prices shot up early this month.
16/11/09 Praveena Sharma/Daily News & Analysis

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Categories: Indian Aviation- In General Nov 2009