Daijiworld Media Network- New Delhi
New Delhi, May 1: In a significant move expected to benefit multiple sectors of the economy, state-run oil companies on Thursday announced a reduction in commercial LPG and Aviation Turbine Fuel (ATF) prices, in response to falling global crude oil prices.
According to official sources, the price of a 19-kg commercial LPG cylinder has been reduced by Rs 14.50, offering relief to restaurants, hotels, and businesses reliant on bulk cooking gas. At the same time, jet fuel prices were slashed by 4.4 per cent, or approximately Rs 3,954.38 per kilolitre, bringing the new ATF rate to Rs 85,486.80 per kilolitre.
This marks the second straight monthly reduction in ATF prices, following a 6.15 per cent cut on April 1, effectively reversing the price hikes witnessed earlier in the year. The latest move is expected to ease operational costs for airlines such as IndiGo, Air India, and Vistara, for whom fuel comprises nearly 30 per cent of total expenditure.
The cuts come as Brent crude prices tumble to nearly $63 a barrel, the lowest level since April 2021, due to a slowdown in global demand. Market analysts point to Saudi Arabia’s reluctance to impose fresh supply cuts, signalling a shift away from OPEC’s earlier pricing strategies and hinting at a prolonged period of soft oil prices.
India, which imports nearly 85 per cent of its crude requirements, is poised to gain significantly from this global downturn. Experts note that reduced oil import costs help narrow the current account deficit (CAD), boost the rupee, and curb domestic inflation by lowering fuel and transport costs.
The Petroleum Ministry, in response to the favourable pricing environment, had last month announced a hike in excise duties on petrol and diesel. However, Union Petroleum Minister Hardeep Singh Puri clarified that the public sector oil companies—IOCL, BPCL and HPCL—will absorb this hike, leveraging their reduced input costs amid falling crude rates.
The cascading benefits of the global oil price decline are expected to revive consumer sentiment, aid macroeconomic stability, and keep inflationary pressures in check, even as the government shores up revenue through higher fuel levies.