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Market Chatter: Indian Airlines Seek Delay in Aviation Fuel Price Hike

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Major Indian airlines have asked state-run oil refiners to halt jet fuel price increases for domestic flights until the Middle East conflict eases, Bloomberg News reported Wednesday, citing people familiar with the matter.

The proposal was floated by domestic airlines, including Air India, IndiGo (NSE:INDIGO, BOM:539448), and SpiceJet (BOM:500285), the report said.

They reportedly warned the government that raising fuel prices could lead to flight suspensions and broader business disruptions.

State-owned refiners, including Indian Oil Corporation (NSE:IOC, BOM:530965), Hindustan Petroleum Corporation (NSE:HINDPETRO, BOM:500104), and Bharat Petroleum Corporation (NSE:BPCL, BOM:500547) are currently considering the proposal, according to the report.

India's Ministry of Petroleum and Natural Gas has joined the discussions and may intervene directly, as it did in Aprl and May, the report added.

Aviation fuel in India is deregulated and is fixed by the country's main oil marketing companies, which revise the prices each month.

However, in April, to lessen the impact of the surge in global oil prices, the Indian government capped the most recent jet fuel price hike to 25% and asked the oil companies to keep them constant in May, Bloomberg added.

A decision on the airlines' proposal is expected before June 1, the report said.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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