Deora calls airlines, oil firms for meet on dues

Petroleum Minister Murli Deora will meet Civil Aviation Minister Praful Patel and chiefs of airlines and oil companies to discuss a solution for dues of over Rs 2,000 crore that the domestic carriers owe the state-owned oil marketers on fuel sales.

“We are trying to help them. We don’t want airlines to close operations,” Deora said on the sidelines of a conference today.

The airlines have not been able to pay since they are making losses owing to a slowdown in passenger traffic and expansion investment. Most have also defaulted on the 60-day credit limit from oil companies.

The airlines say their losses are partially due to the high aviation turbine fuel (ATF) prices. On ATF pricing, Ravi Nedungadi, CFO, UB Group — promoter of Kingfisher Airlines —, said the public sector oil companies are not passing the full benefits of the fall in oil prices to the airlines.

ATF prices have fallen over 20 per cent in the last two months after rising every month since February this year as global oil prices soared.

“There is a proposal we have prepared. There are some issues on the import of ATF,” said Nedungadi.