Business Daily from THE HINDU group of publications
Tuesday, Jan 01, 2008
ePaper | Mobile/PDA Version
Business Daily from THE HINDU group of publications Tuesday, Jan 01, 2008 ePaper | Mobile/PDA Version |
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Airlines Industry & Economy - Petroleum Logistics - Outlook Will airlines pass on gains from lower fuel prices?
Our Bureau New Delhi, Dec. 31 Domestic flights could cost less in the New Year. With aviation turbine fuel costing 4 per cent less in January vis-a-vis the previous month, domestic airlines indicated on Monday that they could look at reducing the fuel surcharge on some routes. “The surcharge is likely to come down. It would be difficult to quantify the decline since on long haul flights most airlines recover their costs while this is not the case on flights which are of less than 90 minutes duration,” the Executive Chairman of low cost airline SpiceJet, Mr. Siddhanta Sharma, said. At the moment, most airlines impose a surcharge of Rs 2,025 to offset the increasing ATF prices. A spokesperson for Air Deccan said a decision on whether the surcharge should be lowered was likely to be taken by Wednesday (January 2). The Managing Director, Paramount Airways, Mr M. Thiagarajan, however said that the airline had no immediate plans of lowering the surcharge as ATF prices were “fluctuating a lot.” The decision by some airlines to re-visit the surcharge follows Indian Oil lowering ATF prices. On Monday, IOC announced that in January airlines refuelling in Delhi would be charged Rs 45,495.82 per kilolitre of ATF (down from Rs 47,444.14 in the previous month), while in Chennai airlines would pay Rs 49,372.63 per kilolitre (down from Rs. 51,425.19 charged during December ‘07). Airlines were, however, being cautious about announcing any immediate reduction in the surcharge as there had been a lot of volatility in global fuel prices following the assassination of former Pakistan Prime Minister, Ms Benazir Bhutto, which could further affect their operations. In India, ATF accounts for 30-35 per cent of the operating costs of airlines. Air travel to cost more on fuel price rise No change in domestic air fare despite fuel price cut Oil cos to cut aviation fuel prices Pak developments push crude, gold price higher More Stories on : Airlines | Petroleum | Outlook
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