Private sector players in India's aviation fuel business are witnessing a significant increase in market share as they expand their supply networks and secure more contracts with airlines. Joint ventures like Reliance-BP and Shell-MRPL have expanded their market share to 9% in February, up from 5.5% in the same month last year and 6% in February 2022.
Reliance-BP's share increased to 5.4% in February from 3.3% a year earlier and 3.9% in 2022. Similarly, Shell-MRPL's share grew to 3.6% from 2.2% a year earlier and 2.25% in 2022.
Traditionally, state-run refiners have dominated India's aviation fuel market. However, private players have been making strides over the past decade, benefiting from open access at airports. Reliance and its joint venture with BP supply jet fuel at approximately 30 airports and cater to most domestic airlines. Shell's joint venture sources jet fuel from MRPL's Mangaluru refinery to supply airports in South India.
Private players are expanding their domestic market share despite slightly lower margins on jet fuel exports compared to domestic sales. Their efforts to expand the supply network to more airports and secure new contracts with airlines have contributed to their increased market share.
The aviation fuel market has seen a resurgence this year after facing lower volumes during the pandemic due to travel restrictions. Jet fuel sales have surpassed pre-pandemic levels, driven by a surge in domestic air traffic to record highs.
The presence of open access at airports has facilitated competition between private fuel suppliers and state-run oil companies, which control the supply infrastructure. Most major airports now have open access, enabling private players to compete effectively in the market.
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