Indian Oil Corp. earlier today raised jet fuel prices for local airlines significantly, before cutting them sharply hours later, media are reporting, as the world’s third-largest importer of crude grapples with the fallout of the Middle East war.
Jet fuel prices in India surged twofold earlier in the day, the Indian Express reported, hitting an all-time high of 207,341 rupees, equal to almost $2,200 per kilolitre in New Delhi, as the country’s largest oil company sought to manage the impact of oil import disruptions.
Hours later, however, Bloomberg cited the company as announcing a cut in the price of aviation fuel to about half that, or 104,927 rupees, equal to some $1,119 per kilolitre. Per the Indian Express, however, airlines had already hiked fuel surcharges on plane tickets by between 150 rupees ($1.60) for domestic flights and $200 for long-haul international flights.
The report noted that international jet fuel prices had hit $195.19 per barrel in the last week of March. This was up by 103.9% from the average for February and a 116.8% than the average for March last year.
“The financial impact of this crisis is yet to be fully felt, as although the spot price of jet fuel has more than doubled, most of the impact will only hit us from next month,” Air India’s chief executive wrote in a letter to staff in late March, according to the Indian Express.
“There will be pockets of new demand, such as we’re seeing on—and deploying additional flights to—some Europe and North America cities, but already airlines in some parts of the world are reducing some flights due to high fuel prices,” Campbell Wilson also wrote.
Indeed, The Telegraph reported earlier this week that thousands of flights had been grounded due to the global surge in jet fuel prices. On Monday, more than 5% of scheduled flights were canceled, the UK publication wrote, citing aviation analytics data provider Cirium.
By Irina Slav for Oilprice.com
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