Air India owes Rs 5,000 cr in fuel dues; hasn't paid in 230 days: Oil cos

New Delhi: Air India owes three state-owned oil firms Rs 5,000 crore in unpaid fuel bills with payments being delayed by almost eight months, forcing retailers to snap supplies, Indian Oil Corp (IOC) said on Friday.

IOC, Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) on Thursday afternoon stopped jet fuel or ATF supplies to Air India at six airports - Kochi, Pune, Patna, Ranchi, Vizag and Mohali - over payment defaults.

"The joint decision to stop fuel supply to Air India from six airports, i.e., Kochi, Mohali, Pune, Ranchi, Patna and Visakhapatnam, was taken by the oil marketing companies in the wake of long overdue payments to the tune of Rs 5,000 crore," IOC said in a statement issued on behalf of the three firms explaining the constraints that led to take the harsh decision. The overdue amount includes the interest accrued on the outstanding dues.

Air India has a 90 day credit period, which means the aviation turbine fuel (ATF) it buys on a given day has to be paid for in three months. But Air India had not been making payments and the credit period was now 230 days, IOC said.