Air India's Monthly Fuel Bill Might Spike By Rs 50 Crore On Higher Oil Prices: Official

Air India's monthly fuel bill might rise by at least Rs 50 crore if the crude oil prices continue to surge in the wake of drone attacks on oil facilities in Saudi Arabia, a senior airline official said on Monday. The national carrier's fuel bill every month is around Rs 500 crore.

According to the official, the bill could go up by at least Rs 50 crore if the oil prices jump 10 per cent from USD 60 per barrel level on a sustained basis. An increase in oil prices could also result in fares going up as costs would have to be passed on, he added.

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Besides, steep foreign exchange rate fluctuations would increase the fuel costs since payments are made in dollars, the official said. On Saturday, drone attacks targeted Abqaiq, the site of the largest oil processing plant run by the Saudi state oil company, Aramco, and the Khurais oilfield in Saudi Arabia.

As surge in oil prices roiled markets, aviation stocks also tumbled. Shares of domestic carrier SpiceJet dropped 3.95 per cent to Rs 126.40 on the BSE. The scrip of InterGlobe Aviation, parent of the country's largest airline IndiGo, fell 2.71 per cent to Rs 1,671.70 on the exchange. According to reports, oil prices witnessed their biggest daily gain since the Gulf war in 1991.