PSU oil companies on Saturday resumed jet fuel supplies to cash-strapped Air India following talks mediated by the government, an official spokesperson said.
Supplies to Air India resumed from Saturday evening, he said.
Declining to give details of the agreement reached at talks earlier this week, the spokesperson said Air India has agreed to payment terms for future ATF purchases.
Indian Oil Corp, Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) on August 22 afternoon stopped fuel supplies to Air India at six airports of Kochi, Mohali, Pune, Patna, Ranchi and Vizag over payment defaults.
According to the three fuel retailers, Air India owed Rs 5,000 crore in unpaid fuel bills with payments being delayed by almost eight months.
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 230 days, forcing oil firms to snap supplies.
Air India uplifts about 250 kilolitres (kl) of ATF at the six airports on a daily basis.
Air India flights operating from the six airports, where ATF supplies were suspended, were tanking up from other airports.
Air India has a debt of over Rs 58,000 crore.