Domestic airfares looked set to go up on Saturday as public sector oil companies raised air turbine fuel (ATF) prices, reflecting rising global crude prices. Airlines will announce the fare hikes — expected to be about Rs 600 on longer routes like Delhi-Mumbai, and a little less for shorter flights — in a day or two.
ATF prices have gone up 19 per cent from Rs 58,387 to Rs 69,227 per 1,000 litres in Delhi, and from Rs 60,468 to Rs 71,759 in Mumbai. International crude prices shot to $135 per barrel in May from a mere $50 in early 2007.
“We’re evaluating the quantum of hike. We’ve no option but to pass on the burden to passengers,” said K.G. Viswanath, senior general manager with Jet Airways. “All airlines are looking at rightsizing capacity to tackle the crisis.”
A Kingfisher Airlines spokesperson said the airline would “take a view shortly”. Business class carrier Paramount will announce a hike on Monday, their MD, M. Thiagarajan, said.
“These fuel prices will kill aviation. The finance ministry must reduce sales tax to 4 per cent (presently, it is over 30 per cent),” said Kapil Kaul, India CEO of consultancy firm Centre for Asia Pacific Aviation.