Shares of Interglobe Aviation, IndiGo Airlines' parent surged up to 10% after the opening bell on Wednesday, April 8 as the US and Iran agreed on a temporary ceasefire resulting in a significant slump in oil prices.
Interglobe Aviation shares was trading 10% higher at Rs 4,695 apiece by 9:22 a.m. The benchmark NSE Nifty 50 was up 3.45%.
The shares jumped after brent prices fell sharply following US President Donald Trump's announcement of a two-week ceasefire, hours after he threatened to end the Iran civilisation.
Brent prices dropped almost 6% at $103 per barrel following the announcement. West Texas Intermediate (WTI), fell even more sharply, with cut of up to 15% at $96 per barrel.
Since the outbreak of the war, oil prices surged significantly with the airline earlier flagging data from International Air Transport Association's Jet Fuel Monitor showing that fuel prices in the region have surged more than 130% on a month-on-month basis. Following this, IndiGo had revised its domestic fuel charges based on distance bands. Additionally, airspaces in many Gulf countries have been closed frequently during the war.
IndiGo said that the government's intervention helped prevent a sharper increase in fares, highlighting that a full pass-through of fuel cost increases would have significantly impacted prices.
The ATF prices more than doubled on international routes in the past month, the airline has also revised fuel charges across regions including the Indian subcontinent, Middle East, Southeast Asia, Africa and Europe.
IndiGo had informed that fuel prices jumpled significantly, of which a part has been paased to the consumers to minimise burden on travellers. Fuel typically accounts for around 40% of total operationg costs of Indian airlines, making ATF prices a crirtical composent to determine tickets fares.
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