According to industry observers, airlines may not reduce passenger fares following the reduction in the price of aviation turbine fuel for the second time in October.

   Airlines may eschew fare reduction because of strong demand amidst festive season and also reduction in seats on several routes after Kingfisher Airlines suspended operations.

   Oil Marketing Companies (OMCs) reduced Aviation Turbine Fuel (ATF) prices for the second time in October by 3 per cent. Following this, every litre of ATF would cost Rs 68.40 in Delhi against Rs 70.51 earlier. The previous reduction was on October 1 when prices came down 4.33 per cent.

   Airlines have faced higher fuel prices for the past several months, but the festival season and seat reduction mean this will not translate into any drop in passenger fares.

   Airlines do not make a public announcement about any price cut as they are very often accused of cartelisation. With major festivals such as Dussehra and Diwali in the offing, there is more demand, reports indicate.