The Nepal Oil Corporation (NOC) reduced the price of international aviation turbine fuel beginning from 7th June 2021 midnight Sunday. Fuel is the largest operating expense for airlines, accounting for as much as one-third of total costs. A 20 percent drop in fuel price, according to airlines, may see a roughly 10 percent drop in ticket prices.
The aviation turbine fuel price by a steep 20 percent in a move that could come as a much-needed respite for international airlines. The decision comes amid complaints that the airlines were facing financial pain because of lost revenue in the face of the Covid-19 pandemic.
With the price reduction, airfares have likely come down that have been a big respite for Nepalese, particularly migrant workers, who were forced to pay a hefty amount for tickets to the airlines operating to and from Nepal.
NATTA had also been lobbying and requesting the government to determine the jet fuel price for a long time making the market competitive.
International passenger markets remained weak due to the ongoing border restrictions, particularly in Nepal, exacerbated by the uneven progress in vaccination rollouts and the resurgence in Covid-19 transmissions. Nepal’s civil aviation body allowed limited passenger flights to and from key international gateways like Turkey, Qatar, China and India.