IndiGo shares decline 5% as crude oil prices rise over $102/bbl; here’s how SpiceJet shares are faring

This comes after US President Donald Trump disclosed that the US-Iran talks had failed over the weekend and the United States is planning to blockade the marine traffic at the Strait of Hormuz.

Further, the government hiked the windfall tax to ₹42 a litre on aviation fuel from an earlier ₹29.5 a litre. The government had, on March 26, imposed an export duty of ₹21.50 a litre on diesel and ₹29.50 a litre on Aviation Turbine Fuel (ATF). The duties were levied to increase domestic availability of the fuel amid the war in West Asia.

In a notification on April 11, the finance ministry said that the duty hikes would be applicable with immediate effect.

With the last hike, the price of aviation turbine fuel (ATF), or jet fuel, had more than doubled to a record ₹2.07 lakh per kilolitre. The ATF price in Delhi was hiked by ₹110,703.08 per kilolitre, or 114.5%, to ₹207,341.22 per kl, according to state-owned fuel retailers.

ATF, being a completely deregulated product, is priced at prevailing benchmark international prices. This is as per a written understanding with the airlines.

Brent crude oil prices jumped to $103.47 per bbl at 5 am (IST) on Monday, compared to $95.2 per bbl at the previous market close, according to Investing.com data.

IndiGo’s revised fuel charges 

The country's largest airline on April 1 had revised fuel charges ranging from ₹275 to ₹10,000, which had pushed airfares higher for many domestic and international flights amid the rise in jet fuel prices.

"Although fully offsetting the fuel price increase would require substantial fare revisions, IndiGo has passed on a relatively smaller amount to customers, keeping in mind the consequential burden on them," IndiGo had said, and regretted the inconvenience to passengers resulting from the fuel charges.

For domestic flights, the revised fuel charges will be ₹275 to ₹950, and in the case of international flights, the fuel charges will vary from ₹900 to ₹10,000. The charges, which will depend on the distance, will be applicable from 0001 hours on April 2.

The fuel charge will be ₹275 for domestic flights on routes that are 0-500 km long and ₹400 for flights that fly 501-1,000 kms.

The amount will be ₹600 for 1,001-1,500 kms, ₹800 for 1,501-2,000 kms, and ₹950 for distances above 2,000 kms.

Currently, the airline levies a flat fuel charge on domestic flight tickets.

SpiceJet to pay $8 million to engine lessor

However, the market investors shrugged off these concerns as SpiceJet stock hit upper circuit on Monday.

IndiGo & SpiceJet shares

Shares of InterGlobe Aviation have surged 9%, while SpiceJet shares rallied over 19% over the last week. IndiGo shares have slipped 5% to touch intraday low of ₹4,410 apiece on Monday.

At 9:40 AM, IndiGo shares trading at ₹4,405.60 apiece on the National Stock Exchange, falling 3.37%. SpiceJet shares, however, were trading 4.97% upper circuit at ₹12.88 apiece.