1 day ago
Centre May Revive Jet Fuel Price Stabilisation Scheme
Jet fuel has become much more expensive for airlines.
The government may bring back a plan to help keep its price steadier.
The plan would let participating airlines buy fuel from public oil companies at a set price.
A fund would help compensate those companies when selling fuel caused them losses.
Airlines did not join the plan the first time because fuel prices fell.
Prices have now risen again, and IndiGo has increased a fuel charge on tickets.
An airline group wants the government to change how fuel prices are set.
The government is talking with airlines and oil companies, but has not announced a decision.
The government may consider reviving a ₹10,000-crore Price Stabilisation Fund scheme as jet fuel prices rise.
The scheme previously lapsed after no Indian airlines signed up when international prices eased.
Under the plan, participating airlines would buy fuel from public sector oil marketing companies at a fixed price.
Jet fuel was priced at ₹137 per litre in Delhi after a roughly ₹16-per-litre increase on October 1.
The Federation of International Airlines urged a shift to cost-plus pricing, warning that airlines may drop unsustainable routes.
- Who
- The government, Indian airlines, and public sector oil marketing companies.
- What
- The government may consider reviving a scheme to stabilise jet fuel prices for participating airlines.
- Where
- India.
- When
- A senior government official raised the possibility on Tuesday; jet fuel prices were last revised on October 1.
- Why
- Jet fuel prices have surged amid volatility in international markets and disruptions to global energy flows.
Key facts
- Proposed fund
- ₹10,000 crore
- Previous scheme status
- It lapsed after no airlines signed up within the prescribed timeline.
- Planned duration
- Up to three years
- Fixed price under scheme
- ₹115 per litre in Delhi, with prices varying by airport because of differences in state taxes.
- Latest reported Delhi price
- ₹137 per litre after an increase of about ₹16 per litre on October 1.
- Fuel share of airline operating costs
- The Federation of International Airlines said jet fuel now accounts for 55–60%, compared with 30–40% earlier.
- IndiGo response
- The airline raised fuel surcharges on tickets after six months.
Sources
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