In a huge shock for airlines and the aviation industry that may see domestic airfares skyrocket by almost 50 per cent in the next few weeks, state-owned oil firms hiked the price of aviation turbine fuel (ATF) to an all-time high due to soaring global crude prices. ATF prices have been hiked by about seven per cent by nearly `5,000 from `70,203 to `75,031 per kilolitre in Delhi. Airlines are likely to immediately begin the process of evaluating the impact of ATF hikes on operating costs. Both domestic and international airfares are expected to rise substantially now, which will be bad news for passengers.
“The steep hike in ATF prices is a huge shock for airlines. Airfares are now expected to skyrocket due to a combination of factors such as the ATF price hike and the forthcoming festival season. Domestic airfares could now increase by as much as 50 per cent,” said travel agent Rajji Rai, vice-president of the Universal Federation of Travel Agents Association.
“With this huge ATF hike, domestic and international airfares are bound to rise substantially to neutralise the impact of the ATF hike. Airlines will have no option but to pass on the burden to passengers,” said a top executive of a private airline.
Top civil aviation ministry sources said the ATF hike could spell the end of a respite for passengers, who were enjoying discounts offered on domestic airfares.