- Thursday, April 25, 2024
By: Radhakrishna N S
INDIA’S largest commercial oil company briefly stopped supplying fuel to Jet Airways today (5), in a sign that the woes of the beleaguered carrier are far from over.
The Indian Oil Corporation (IOC) halted supplies to the debt-addled airline at noon for not meeting payments, an IOC spokesperson said.
“If there is some payment made by Jet, we will resume our refuelling services,” they said.
Later the spokesperson said that deliveries had resumed, but declined to comment on whether Jet had made any payments.
The Mumbai-based airline, which was until recently India’s second-biggest by market share, has also defaulted on several loan payments.
It was not immediately clear how dependent Jet is on the IOC for fuel but analysts said the move could signal the start of the end game for Jet.
“You can be rest assured that everyone else will follow. If that happens Jet Airways is finished,” Devesh Agarwal, editor of the Bangalore Aviation website said.
Jet Airways was not immediately available for comment.
Last month creditors injected £167 million of “immediate funding support” into Jet as part of a debt resolution plan.
The move saw a consortium of lenders, led by the State Bank of India, take control of the struggling airline from founder Naresh Goyal, who stepped down as chairman.
The consortium is starting a stake sale process on Saturday (6), giving prospective bidders until Tuesday (9) to submit expressions of interest for buying a stake.
A collapse would deal a blow to prime minister Narendra Modi’s pragmatic pro-business reputation ahead of elections starting next week.
On Monday (1), it announced that another 15 aircraft had been grounded due to non-payment.
Jet is currently operating just 26 planes from its 119-aircraft fleet.
The carrier has been badly hit by fluctuating global crude prices and a weak rupee, as well as fierce competition from budget rivals.
(AFP)
