The rise in crude oil prices has also made ATF more expensive. Because ATF has a direct impact on the operating costs of airlines
Air Fare Will Be Expensive! ATF Prices Increased By Rs 5 Per Litre: Indian Oil Corporation has increased the price of Aviation Turbine Fuel (ATF) by Rs 5 per litre. ATF price for domestic airlines has now increased from Rs 110 per liter to Rs 115 per litre. This hike will increase fuel costs for domestic airlines.
Turbine fuel accounts for 40 percent of the total operating costs of airlines. So even a small increase in it leads to a huge increase in cost. After this increase, now there is an increase in air fares. However, the change in fares is not only based on the price of ATF. Many other factors also affect it.
Aviation turbine fuel is a special type of fuel that is used to propel airplanes. Due to the ongoing tension in West Asia, the price of crude oil has increased significantly. ATF is also made from crude oil. The rise in crude oil prices has also made ATF more expensive. Because ATF has a direct impact on the operating costs of airlines, a rise or fall in ATF prices can lead to fluctuations in both aviation sector companies’ shares and airfares.
ALSO READ: IPO Rush Next Week: 6 New Issues to Open, 11 Listings Ahead
