Airline stocks extend gains after slide in crude oil prices

Two airline stocks jumped 4.58% to 6.12% at 11:25 IST on BSE after a further slide in crude oil prices.

Meanwhile, the BSE Sensex was up 38.90 points, or 0.14%, to 28,152.60.

Among airline stocks, Jet Airways (India) (up 6.12% to Rs 328.50) and SpiceJet (up 4.58% to Rs 20.55) gained. Shares of Jet Airways and SpiceJet had surged 11.27% and 3.15% respectively, yesterday, 6 July 2015.

In global commodities markets, Brent crude oil futures edged higher after a sharp slide yesterday, 6 July 2015. Brent for August settlement was currently up 62 cents at $57.16 a barrel. Brent crude oil futures for August delivery had slumped $3.78 a barrel or 6.26% to settle at $56.54 a barrel yesterday, 6 July 2015.

Crude oil prices steadied today, 7 July 2015, after posting one of their biggest selloffs this year the previous session over Greece's rejection of debt bailout terms and China's stock market woes.

Jet fuel or aviation turbine fuel (ATF) typically makes up almost half of an airline's operating cost. Prices of jet fuel are directly linked to crude oil prices.

Meanwhile, PSU OMCs had reduced jet fuel prices on 30 June 2015. PSU OMCs reduced jet fuel prices by Rs 2086.56 per kiloliter or 3.91% to Rs 51267.36 per liter in Delhi, with corresponding price revision in other states. The revised jet fuel prices took effect from 1 July 2015. Jet fuel prices were last revised to Rs 53353.92 per kiloliter in Delhi on 1 June 2015.

PSU OMCs review jet fuel prices on the last day of the month based on the average imported oil price for the month.

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