The price of per litre jet fuel was raised by Tk 5 — to Tk 111 — for domestic flights today (June 12, 2022) by Padma Oil Company Limited, a subsidiary of Bangladesh Petroleum Corporation.

Surprisingly, the cost of jet fuel for international flights remains unchanged.

Local airlines operating domestic flights would suffer significant blows as a result of this jet fuel price hike .

Aviation industry insiders told The Daily Star that passengers flying domestic would have to spend more money owing to the price hike.

Padma Oil Company has raised jet fuel prices for the 15th time in 19 months, according to sources in different airlines in the country.

Late last month, the price of jet fuel for both international and local flights was raised by Tk 6 per litre.

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Jet fuel price hits record high

The price of jet fuel, which accounts for up to 46 percent of an airline's operational costs, was Tk 48 per litre in December 2020.

Mofizur Rahman, secretary general of Aviation Operators Association of Bangladesh (AOAB) and managing director of Novo Air, told The Daily Star that there is no rationale to BPC's decision to raise jet fuel prices when the price of jet fuel in the world market remains stable.

He stated: "BPC is making a monopolistic choice to raise the price of aviation fuel and we have nothing to say about it."

"By what logic did BPC raise the price of jet fuel for solely domestic flights?" he questioned.

"Overall, the aviation sector is under pressure right now for a variety of reasons, including regular hikes in jet fuel price, which accounts for 40 to 46 percent of an airline's operational costs," said Kamrul Islam, general manager, public relations of US-Bangla Airlines.

He also said BPC increases jet fuel prices virtually every month. "

However, if we raise the ticket price proportionally, we risk losing passengers."

"On the contrary, air carriers are at risk of going bankrupt if we do not raise air fares in step with the increase in jet fuel price," Kamrul added.

If the aviation business fails, the tourist and hospitality sectors, which employ 40 lakh people, will also fail, he also said.