There is a good news for air travelers at the beginning of the new year. There has been a major reduction in the prices of Air Turbine Fuel (ATF). Government oil companies have taken this decision, which will provide relief to both domestic airlines and passengers. Now air travel may be cheaper than before. Let us know how air travel will be affected by this cut.
Big cut in air fuel prices
Government oil companies have reduced the prices of Hawaiian fuel by about 1.50% from January 1, 2025 after reviewing them. This cut will have a direct impact on the operational expenses of domestic airlines, which is likely to reduce air ticket prices.
New prices of ATF in different cities:
- Delhi:
Earlier it was ₹ 91,856.84/kl, now it has come down to ₹ 90,455.47/kl.
- Kolkata:
The old price was ₹94,551/kl, now it is ₹93,059.79/kl.
- Mumbai:
ATF price reduced from ₹85,861/kl to ₹84,511/kl.
- Chennai:
Earlier it was ₹ 95,231/kl, now it has become ₹ 93,670/kl.
How will air travel become cheaper?
1. Expectation of reduction in fuel surcharge
ATF prices affect the fuel surcharge on air tickets. Due to reduction in fuel costs, airlines can reduce fuel surcharges, which will reduce ticket prices for passengers.
2. Airlines’ costs will be lower
ATF costs account for approximately 40% of the total operating expenses of airlines. Reduction in fuel prices will reduce the operating costs of airlines, which will provide them financial relief and the passengers will benefit from it.
3. Effect of fall of crude oil in the international market
ATF prices have decreased due to fall in crude oil prices in the international market. This trend can make air travel more affordable in the future.
Benefits to passengers
1. Domestic travel will be cheaper
The new ATF price may reduce ticket bookings for domestic flights. This will provide great relief to the passengers celebrating holidays on the occasion of New Year.
2. Accessibility of air travel will increase
Due to cheaper tickets, more people will opt for air travel. This will increase the business of airlines and passengers will get affordable services.
3. Tourism industry will get a boost
More people will travel at lower prices, which will inject new energy into the tourism industry.
Why were ATF prices cut?
1. Fall in international crude oil prices
Crude oil prices have declined globally. This has also affected the prices of air fuel in India.
2. Reducing customer spending
The government and oil companies change fuel prices from time to time with the aim of reducing the expenses of passengers.
3. Providing relief to domestic airlines
Operating expenses of airlines increase due to expensive fuel. Price reductions provide financial relief to airlines, allowing them to offer services at more competitive rates.
Will this change last long?
1. Depend on market conditions
ATF prices depend on the condition of the international oil market. If crude oil prices remain stable, this relief may last for a long time.
2. Possibility of stability
Oil companies try to keep prices stable in the first quarter of the year. With this, air travelers can get cheap tickets for long periods of time.
