Petrol, diesel to cost more; rupee's fall may not push up airfares for now

The depreciating rupee is a cause for concern for Indian airlines, as 25-30 per cent of their cost (excluding fuel) is dollar-denominated

Consumers are currently paying six per cent more for petrol and 19 per cent more for diesel than what they did in May 2014. Even so, Indian Oil Corporation (IOCL), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL) might need a further Rs 2.8-3.7 a litre increase in retail prices to earn normal margins.
 

The rupee’s fall might, however, not push up airfares for now. Airline executives say these rose only four to five per cent in May-June, as it was the holiday season. “The real capacity of airlines to increase prices would be seen when