Air India flight fares to rise as Iran war pushes up jet fuel prices
India Today
Air India said the fuel surcharge is due to the sharp rise in aviation turbine fuel (ATF) prices since early March 2026, triggered by supply disruptions in the Gulf region.
Air travel is set to become costlier, with Air India announcing a phased fuel surcharge on domestic and international routes amid a sharp rise in jet fuel prices linked to the Iran war.
The airline said the surcharge will also apply to services operated by Air India Express.
According to Air India, the increase is being implemented because of the sharp rise in aviation turbine fuel (ATF) prices since early March 2026, triggered by supply disruptions in the Gulf region.
The surcharge will be introduced in multiple phases:
The airline said that the surcharge is being rolled out in Phase 1 and Phase 2, with Phase 3 planned later.
Air India said aviation turbine fuel accounts for nearly 40% of an airline’s operating costs, making airlines highly sensitive to changes in fuel prices.
Sensex has declined over 6,000 points or roughly 7.5% in a little over two weeks as global tensions and rising oil prices triggered selling in equities.
Speaking in Parliament, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said India has adequate fuel stocks, and there is no cause for concern over availability.
Industry sources told India Today TV that airline operators are now paying additional insurance charges for every aircraft flying into the Middle East, significantly increasing the cost of operations on these routes.
Under law, a domestic household is generally allowed to keep two LPG cylinders of 14.2 kg each at a time. This usually includes one cylinder connected for use and another spare cylinder kept as backup.
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The move comes as global energy markets remain on edge due to escalating tensions linked to the conflict involving Iran, which has raised fears of disruptions to crude oil shipments from the Middle East.
India consumes roughly 5.3 to 5.5 million barrels of crude oil every day. However, domestic production is only about 0.6 million barrels per day. This means the country depends on imports for nearly 85% of its oil needs.
At around 10:47 am, the BSE Sensex was down 750.68 points or 0.96% at 77,455.30, while the Nifty 50 slipped 208.25 points or 0.86% to 24,053.35.
Air India said the fuel surcharge is due to the sharp rise in aviation turbine fuel (ATF) prices since early March 2026, triggered by supply disruptions in the Gulf region.
Rahul Bhatia expressed gratitude to employees who worked tirelessly to restore operations during that challenging period, praising their resilience and dedication.
The Iran-US conflict has disrupted shipping through a key global oil export route, pushing oil prices higher. As a result, airline tickets on some routes have become much more expensive, and there are growing concerns that travel demand could weaken if the situation continues.