Best News Ever For Airlines :
The Crude Oil Prices are crashing and have gone below $60, which could be considered as best news ever for airlines.
Crude Oil has a great impact on our economy. The prices of Crude Oil gives direct impact on the ATF and other fuels hence ultimately It dictates the prices of every commodity .The total expense on the ATF (Aviation Turbine Fuel ) is considered more than 40% in an airline. Its the biggest factor for any airline operations.
The Airlines of India are struggling with heavy taxes on ATF and other charges. The reduction in International Crude Prices will give immediate effect on ATF prices. The ATF prices are expected to cut by Rs 1000 per KL.
The Prices of ATF in India at Metro Cities are as follows :
Change in ATF prices over last 6 months in India:
|November 01, 2014
|October 01, 2014
|September 01, 2014
|August 01, 2014
|July 01, 2014
|June 25, 2014
The ATF prices are expected to be reduced by atleast 2000 per kilo litre to Rs 57000 per KL. This will help entire aviation industry in improving the margins and profitability. Spicejet is struggling to survive whereas Vistara and Air Asia are considering it as best time to expand.
There are currently nine Scheduled Airlines in Indian Aviation :
- Jet Airways
- Air India
- Jet Lite
- SpiceJet (Struggling to Survive)
- Go Air
- Air Costa
- Air Asia
- Vistara Air ( expected to fly by Jan end)
Nine Upcoming airlines in India :
1. Air One (Scheduled Airlines )
2.Zexus Air (Scheduled Airlines )
3.Seven Sister Airlines( Scheduled Airlines )
4.Turbo Airlines ( Regional Airlines )
5.Ligare Aviation ( Regional Airlines )
6.Air Carnival ( Regional Airlines )
7. MSD Aviation ( Cargo Airlines)
8. ZAV Airways ( Regional Airlines )
9.Air Pegasus ( Regional Airlines)
10 ABC Airways (Regional Airlines)
Diesel and jet fuel prices have also plunged, helping boost the profits and share prices of airlines. This is the Best News Ever For Airlines The depth of oil’s plunge could be a signal that the global economy is struggling even more than economists think. A weak global economy could hurt the U.S. economy by reducing exports, employment and spending, which together could outweigh the economic benefits of cheaper fuel.
For oil companies, oil-producing states, and oil-exporting countries, like Iran, Iraq, Russia and Venezuela the oil price collapse is extremely painful for them.
Bank of America estimates that every $1 drop in the global price of oil costs Venezuela $770 million in annual revenue.