Flagship international carrier, Air India, has raised its jet fuel hedging limit to 75,000 barrels per day from 30,000 bpd to guard against volatile fuel prices, the company said, reports Reuters.

"The board has raised the limit to give us more flexibility," S Venkat, company secretary, said on Thursday. The state-owned carrier's fuel bill in 2005/06 was Rs 31.34 billion, nearly a third of its total cost.

This year, oil prices soared to a peak of USD 78.40 a barrel in July, but were now trading at about USD 61. Aviation fuel was at about USD 77.11 a barrel at the benchmark Singapore index .

"Air India management extended its hedging limits from 10% of its international uplifts to 25% effective Monday, Sept. 18," the company said in a statement. It said the company's board had also set a hedging limit of 750,000 barrels a quarter.

Air India was the first Indian airline to hedge its jet fuel costs in March this year through a combination of swaps, options and collars.