New Delhi, Oct 7 (UNI): The government is closely watching the impact of the ongoing West Asia crisis on the aviation sector especially the recent pressure on Aviation Turbine Fuel (ATF) prices.
Union Civil Aviation Minister Ram Mohan Naidu said the West Asia crisis is one of the present day major concerns as it has put a big burden on ATF prices.
The government is in discussions with the airlines and Oil Marketing Companies (OMCs) at present to gage the situation and to know the impact of rising fuel prices on the aviation industry, Naidu told the media in New Delhi.
Government to meet stakeholders
The Civil Aviation Ministry is also planning to hold a meeting with all the relevant stakeholders to discuss the issue in detail.
After assessing the situation in consultation with the airlines, oil companies and other stakeholders, the minister said the government will take a decision.
No final decision has been announced to date on any relief measures or changes in ATF pricing.
Airlines Worried over Rising ATF Prices
ATF is one of the biggest expenses for airlines. A significant increase in fuel prices can put additional pressure on the cost structure of aviation companies.
Higher fuel costs affect airline margins and if the increase is sustained for a longer period of time could also affect airfares.
The aviation industry is thus keenly observing the government’s discussions with the airlines and the OMCs.
West Asia crisis adds to energy markets strain
The crisis in West Asia is adding to the uncertainty in the global energy market. Any disruption or long-term geopolitical tension in the region can put pressure on crude oil and related fuel prices.
Energy prices are especially relevant to India’s aviation sector as the cost of ATF has a direct impact on airline operations.
What Comes Next?
The government is expected to hold discussions with all the stakeholders before taking the decision on the next course of action.
The focus, for now, is on assessing the impact of higher ATF prices and the wider implications of the West Asia crisis on India’s aviation sector.
MarketSustain Takeaway: The government’s interaction with airlines and OMCs is an indication that the rising ATF prices are being keenly monitored. The upcoming stakeholder meeting could bring some clarity on whether any measures will be considered to ease the pressure on the aviation industry.
