With the rising fuel prices in India, State-run refiners have increased the jet fuel prices on Friday. This had further lead to worries Within the Indian carriers as they struggle to reboot the operations after Covid 19 induced lockdown.
Increased Fuel Prices May Increase Flight Prices
As per the latest reports, with the increased prices of jet fuel prices, the move is expected to increase the flight prices which could further impact the demand. In the national capital, Delhi, ATF Prices for domestic airlines has increased by 2.44 per cent from Rs 68,262.35 per kilolitre on July 1 to Rs 69,857.97 on July 16. In Mumbai too ATF rose from a level of Rs 66,482.90 per Kl to Rs 68,064.65 per Kl on Friday.
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ATF Prices Have Risen To Nearly 40 Percent Since January 2021
Reports suggest that the ATF prices have risen to nearly 40 percent since January. It rose from Rs 50,000 per KL at the beginning of the year to over Rs 70,000 per KL currently.
Even though the airlines have the option to ATF from another country, but this would curtail the international operations. And this option offers only limited benefits. Following this, the passenger demand amidst the pandemic has dropped significantly which has further made it difficult for the airlines to pass through the entire cost increase.
An official of a budget carrier said that rising and the uncertain demand scenario will make airlines conservative on expanding capacity, especially on routes which have low demand.
