New Delhi: Four of the country's largest airlines have called for an independent regulator to ensure a transparent pricing mechanism for aviation turbine fuel (ATF). But, this has been stalled by state-owned oil marketing companies (OMCs). According to sources in the civil aviation ministry, there were attempts to bring the pricing of ATF under the regulation of the Petroleum and Natural Gas Regulatory Board (PNGRB).
"A number of meetings were held between the public-sector OMCs and the petroleum and aviation ministry officials but nothing was finalised. There is opposition from OMCs regarding this," said a ministry official.
PNGRB has not been mandated by the government to regulate prices of petroleum products. ATF prices are fixed by Indian Oil, Hindustan Petroleum (HPCL) and Bharat Petroleum directly. The ATF price was increased on March 1 after two consecutive price cuts. ATF price touched Rs 3,711 for a kilolitre in September 2012 but came down to Rs 39,301 on March 1. The steep fall in crude oil prices might have played a big role in the turnaround story of the Indian aviation sector, but airlines are still not convinced, saying they have not received the full benefit in terms of jet fuel pricing. This, according to the airlines, is due to the public-sector OMCs, which enjoy monopoly in the market and are not keen to lower ATF prices.
29/03/16 Arindam Majumdar/Business Standard
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"A number of meetings were held between the public-sector OMCs and the petroleum and aviation ministry officials but nothing was finalised. There is opposition from OMCs regarding this," said a ministry official.
PNGRB has not been mandated by the government to regulate prices of petroleum products. ATF prices are fixed by Indian Oil, Hindustan Petroleum (HPCL) and Bharat Petroleum directly. The ATF price was increased on March 1 after two consecutive price cuts. ATF price touched Rs 3,711 for a kilolitre in September 2012 but came down to Rs 39,301 on March 1. The steep fall in crude oil prices might have played a big role in the turnaround story of the Indian aviation sector, but airlines are still not convinced, saying they have not received the full benefit in terms of jet fuel pricing. This, according to the airlines, is due to the public-sector OMCs, which enjoy monopoly in the market and are not keen to lower ATF prices.
29/03/16 Arindam Majumdar/Business Standard
