Aviation turbine fuel is a part of operating expenses of airline companies and a fluctuation in international oil prices impact their financials.
Shares of SpiceJet and IndiGo operator InterGlobe Aviation fell 6 percent and 4 percent intraday, respectively, on September 16 following an 11 percent jump in oil prices brought on by a drone attack on two Saudi Arabia facilities.
SpiceJet was quoting at Rs 125.65, down Rs 5.95, or 4.52 percent and InterGlobe Aviation was down 3.13 percent at Rs 1,664.50 on the BSE at 0945 hours.
Aviation turbine fuel is a part of operating expenses of airline companies. Any fluctuation in international prices impacts their financials.
Early September 14, armed drones struck an oil processing facility at Abqaiq and the nearby Khurais field, impacting 5.7 million barrels of daily crude production, or 50 percent, of the kingdom’s oil output.
As a result, Brent crude futures, the International benchmark for oil prices, soared $6.69, or 11.11 percent, to $66.91 per barrel intraday. US West Texas Intermediate crude futures also jumped $5.41, or 9.86 percent to $60.26 per barrel.
Reports suggested that Saudi Aramco, the national oil company, aims to restore about a third of its crude output, or 2 million barrels, by September 16.
Yemen’s Houthi rebels have claimed the attack and threatened more unless Saudi Arabia and its allies ended their offensive against them. The Houthis are allegedly backed by Iran.
Abqaiq is the world’s largest oil-processing facility and crude stabilisation plant with a capacity of more than 7 million barrels per day. Khurais is the second largest oil field in the country that pumps around 1.5 million barrels per day. In August, Saudi Arabia produced 9.85 million barrels per day.
SpiceJet was quoting at Rs 125.65, down Rs 5.95, or 4.52 percent and InterGlobe Aviation was down 3.13 percent at Rs 1,664.50 on the BSE at 0945 hours.
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