Jet fuel prices have been cut by 1.8% and rates of non-subsidised cooking gas (LPG) by Rs. 23.50 per cylinder after the rupee's appreciation lowered import costs.
The price of jet fuel, also known as aviation turbine fuel (ATF), at Delhi was cut by Rs. 1,285.89 per kilolitre, or 1.81%, to Rs. 69,747.98 per kl, according to Indian Oil Corp, the nation's largest fuel retailer.
This is the third reduction in jet fuel rates since April. Declining international oil prices and the strengthening of the rupee against the US dollar have made imports cheaper.
In Mumbai, jet fuel costs Rs. 71,940.36 per kl as against Rs. 73,306.89 per kl previously, IOC said. The rates vary because of differences in local sales tax or VAT.
Jet fuel constitutes over 40% of an airline's operating costs and the price cut will ease the financial burden of cash-strapped carriers.
No immediate comments were available from airlines on the impact of the price cut on passenger fares.
Separately, the price of non-subsidised LPG, which customers buy after using up their quota of 12 subsidised cylinders, was cut by Rs. 23.50 per cylinder, the fifth straight reduction in rates since February.
Each non-subsidised 14.2-kg cooking gas cylinder will now cost Rs. 905, down from Rs. 928.50, in Delhi.
The rates were cut on February 1 by Rs. 107 -- from Rs. 1,241 per cylinder to Rs. 1,134, by Rs. 53.5 per cylinder in March to Rs. 1,080.50, by Rs. 100 to Rs. 980.50 in April and by Rs. 52 last month.
A subsidised LPG cylinder in Delhi costs Rs. 414. Non-domestic LPG rates were increased by a steep Rs. 220 per cylinder at the beginning of the year but have now been cut in line with softening international rates.
IOC said losses on LPG have come down to Rs. 432.71 per subsidised cylinder from Rs. 449.14 in the previous month. The loss was Rs. 762.50 in January.
The three fuel retailers -- IOC, Hindustan Petroleum Corp and Bharat Petroleum Corp -- revise jet fuel and non-subsidised LPG prices on the first of every month, based on the average international prices in the preceding month.