In the first reduction in more than seven months, state-owned oil companies today cut

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jet fuel price by over 2.9 per cent after international oil rates cooled off from two-year high.

Oil companies reduced ATF (air turbine fuel) price by Rs 1,766 per kilolitre or 2.9 per cent, to Rs 58,794 per kilolitre in Delhi, an official of Indian Oil Corporation said here, adding prices are effective from midnight tonight.

In Mumbai, ATF price has been reduced by Rs 1,827 to Rs 59,602 per kilolitre, the official said.

The reduction in ATF price has come after 14 successive hikes since October, 2010, when international crude oil prices started soaring.

The ATF price in Delhi on October 1, 2010 was Rs 40,728.52 per kl. The rates were increased by Rs 19,831.48 per kl, or 48.7 per cent till April 30, when last price hike was announced.

No comment could be immediately obtained from airline companies on the impact of the price reduction on passenger fares.

Fuel cost accounts for 40 per cent of the airlines' operating cost and rates vary from airport to airport depending upon the local sales tax.

Indian Oil Corp and its sister public sector retailers Bharat Petroleum and Hindustan Petroleum revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.