Business Economy


ATF prices hiked for fourth straight month, Commercial LPG rates rise by Rs 10

New Delhi, Nov 1 (UNI) Aviation turbine fuel (ATF) prices have been increased for the fourth consecutive month, while commercial liquefied petroleum gas (LPG) rates have also been raised, reflecting the continued firmness in international energy prices.
The latest revision, effective November 1, will add to the operating expenses of airlines as well as restaurants, hotels and other businesses that rely on commercial cooking gas.
According to state-owned oil marketing companies (OMCs), ATF prices have been raised by Rs 1.37 per litre to Rs 138.50 per litre from Rs 137.12 per litre. The latest increase follows a steep hike of Rs 16 per litre on October 1. Before that, jet fuel prices were increased by Rs 6.28 per litre in September and Rs 5 per litre in August.
The continued rise in aviation fuel prices is likely to put additional pressure on airline operating costs. ATF accounts for nearly 40 per cent of an airline's total operating expenditure, making it one of the biggest cost components for the aviation industry.
Higher fuel expenses could also put pressure on airline profitability and potentially influence airfares, depending on how much of the additional cost carriers are able to absorb or pass on to passengers. Commercial LPG prices have also witnessed an upward revision.
Rates have been increased by Rs 10 per 19-kg cylinder to Rs 2,820. This marks the second consecutive monthly increase after commercial cooking gas prices were raised by Rs 62.50 per cylinder in October. In September, rates had gone up by Rs 9.50 per cylinder.
The latest increases follow substantial reductions in commercial LPG prices during July and August, when rates were cut by Rs 183.50 and Rs 192 per cylinder, respectively.
The earlier reductions came after commercial LPG prices touched a record high in June amid disruptions in global energy supplies and a sharp increase in international fuel benchmarks.
Between February and June, commercial LPG prices has surged by Rs 1,373 per 19-kg cylinder, climbing from Rs 1,740.50 to Rs 3,113.50. Subsequent reductions in July and August provided some relief to businesses, although the September and October revisions have reversed part of those gains.
The monthly revisions in ATF and LPG prices are linked to changes in international benchmark rates and fluctuations in the rupee-dollar exchange rate. Oil marketing companies review these prices on the first day of every month. The final retail rates also differ across states due to variations in local taxes, including value-added tax (VAT). While commercial cooking gas has become costlier, households have received no fresh price shock, with domestic LPG prices remaining unchanged. A 14.2-kg household cylinder continues to cost Rs 942.
Domestic LPG prices has been increased by a cumulative Rs 89 per cylinder between March and June, following disruptions in energy supplies triggered by the West Asia crisis and rising international fuel prices. Retail prices of petrol and diesel have also been kept unchanged in the latest revision. Both fuels had witnessed an increase of around Rs 7.50 per litre in May. The latest revisions highlight the continuing impact of international energy market movements on India's fuel pricing, with businesses dependent on aviation fuel and commercial cooking gas facing higher input costs, even as household cooking gas and transport fuel prices remain unchanged. UNI VK AAB
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