Aviation turbine fuel (ATF) prices have been reduced by around Rs 5 per litre, offering some relief to airlines. However, passengers hoping for cheaper flight tickets may have to wait longer, as airlines are unlikely to reduce fares immediately.
According to industry sources quoted by NDTV, oil marketing companies have lowered ATF prices from around Rs 115 per litre to nearly Rs 110 per litre. However, despite the reduction, fuel prices remain above the levels seen before geopolitical tensions in West Asia pushed up global crude oil prices.
Jet fuel still costlier than pre-conflict levels
ATF currently costs around Rs 1.10 lakh per kilolitre, compared with approximately Rs 1.04 lakh per kilolitre before tensions in West Asia disrupted global energy markets.
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Fuel remains one of the largest expenses for airlines, accounting for nearly 35-40 per cent of operating costs. Although the recent reduction lowers expenses to some extent, airlines believe the savings are not yet enough to bring down ticket prices.
Per NDTV, industry sources indicate that airlines are waiting for fuel prices to return to earlier levels and remain stable before considering any significant fare reduction.
Several factors determine airfares
Airfares are not determined by fuel prices alone. Passenger demand, aircraft availability, airport charges, route capacity and seasonal travel trends also play a major role in ticket pricing.
As a result, reductions in ATF prices do not always lead to immediate changes in airfare levels.
The latest cut follows a period of higher operating costs for airlines after fuel prices increased due to tensions in West Asia. Several carriers also had to deal with longer flying routes and airspace restrictions, adding to operational expenses.
Airlines may absorb savings for now
Industry executives cited by NDTV say airlines are expected to use the latest fuel price reduction to offset a portion of their elevated costs rather than pass the entire benefit on to passengers.
Also Read | ATF price slashed by ₹5 per litre as softer global oil rates bring relief to airlines
For travellers, substantial fare reductions are likely only if global crude oil prices continue to decline and ATF rates return closer to pre-conflict levels.
Until then, airlines are expected to maintain their current pricing strategies while closely monitoring fuel costs, travel demand and market conditions.
FAQs:
Why are flight ticket prices not falling after the ATF price cut?
Airlines say fuel costs remain higher than pre-conflict levels and other operating expenses continue to pressure fares.
Will airfares become cheaper if ATF prices fall further?
Airlines may consider reducing fares if jet fuel prices return to pre-conflict levels and remain stable.
