Jet fuel prices on Wednesday were cut by 1.3 percent — the first reduction after 10 rounds of price hikes — on softening international crude oil rates.
Simultaneously, prices of commercial LPG – used by business establishments such as hotels and restaurants – were reduced by Rs 135 per 19-kg cylinder.
The price of aviation turbine fuel (ATF) — the fuel that helps airplanes fly — has been reduced by Rs 1,563.97 per kilolitre, or 1.27 percent, to Rs 1,21,475.74 per kg (Rs 121 per liter) in the national capital, according to a price notification of state-owned fuel retailers.
This is the first reduction after 10 rounds of price increases this year. Rates were hiked by Rs 6,188.25 per kg, or 5.29 percent, on May 16, to a record high level of Rs 1,23,039.71 per kg.
Commercial LPG rates were reduced to Rs 2,219 per 19-kg cylinder, from Rs 2,354, the notification showed.
Before the cut, rates of commercial LPG had risen by Rs 355.5 per cylinder this year.
However, prices of cooking gas LPG used in households remained unchanged at Rs 1,003 per 14.2-kg cylinder. Rates had been hiked by Rs 3.50 a cylinder on May 19. Before that prices were hiked by Rs 50 per cylinder on March 22 and again by the same quantum on May 7.
Since April 2021, domestic LPG prices have risen by Rs 193.5 per cylinder.
Meanwhile, petrol and diesel prices remained unchanged at Rs 96.72 per liter and Rs 89.62 a liter respectively. An excise duty cut by the government had helped reduce petrol by Rs 8.69 a liter and diesel by Rs 7.05 per liter on May 22 but for that, the base price has remained unchanged since April 6. Before that, prices had risen by a record Rs 10 per liter each.
The retail price of petrol, diesel, and domestic cooking gas was way below the cost and so the softening in benchmark prices is being used to set off those losses.
Jet fuel prices are revised on the 1st and 16th of every month, while petrol and diesel rates are revised daily, based on equivalent rates in the international market.
ATF in Mumbai now costs Rs 120,306.99 per kg, while it is priced at Rs 126,369.98 in Kolkata and Rs 125,725.36 in Chennai.
Rates differ from state to state, depending on the incidence of local taxation.
Fuel rates have been on the rise in India because energy prices globally have risen on the back of supply concerns following Russia’s invasion of Ukraine and demand returning after being hit by the pandemic. India is 85 percent dependent on imports to meet its oil needs.
While oil prices have eased from a near 14-year high of USD 140 per barrel, it continues to trade above USD 100. On Wednesday, Brent – the world’s most used benchmark – was trading at USD 117.07 per barrel.
To compound things, the rupee has depreciated against the US dollar, making imports costlier.