New Delhi:
Aviation Turbine Fuel (ATF) prices in India surged to a record Rs 2.07 lakh per kilolitre, crossing the Rs two lakh mark for the first time amid escalating tensions in West Asia. The sharp rise is driven by global supply disruptions, including the closure of the Strait of Hormuz, and increased crude prices. ATF accounts for around 40% of an airline’s operational costs, making it a key driver of airfares.
Despite the steep hike, domestic airlines are being shielded from the full impact. The Union Petroleum Ministry said public sector oil marketing companies (OMCs), in consultation with the Civil Aviation Ministry, implemented a partial and staggered increase of about 25%, or Rs 15 per litre, for domestic carriers. This measure is aimed at preventing a sharp rise in domestic ticket prices.
International airlines operating from India, however, will pay the full revised ATF rates, consistent with global pricing. State-owned Indian Oil, Bharat Petroleum, and Hindustan Petroleum revise ATF prices monthly based on international benchmarks and exchange rates.
Industry experts, including the International Air Transport Association (IATA), have already noted rising fuel costs are contributing to higher airfares, particularly on international routes where airlines are forced to take longer paths due to airspace restrictions. The government’s staggered hike provides relief to domestic travelers, while global volatility continues to put pressure on airlines’ margins.
