Air India hikes fuel surcharge amid spike in ATF prices; check sector- and route-wise rates

Air India group on Tuesday announced a revision in fuel surcharges across its domestic and international routes, citing a sharp surge in global jet fuel prices.

Jet fuel prices in Delhi were hiked by over 114% earlier this month to a record ₹2,07,341.22 per kilolitre, according to state-owned fuel retailers, marking the second consecutive monthly increase.

The previous peak was recorded in 2022 following the Russia-Ukraine conflict.

Jet fuel accounts for nearly 40% of an airline’s operating costs, making carriers highly sensitive to fluctuations in ATF prices.

The government, however, intervened to cushion domestic air travellers from a sharp spike in ATF prices, allowing only a partial and staggered pass-through of the increase for domestic operations.

The Tata Group-owned airline said it will move from a flat fuel surcharge to a distance-based structure for domestic routes.

Under the revised structure, passengers will pay ₹299 per sector for flights up to 500 km, ₹399 for 501–1,000 km, ₹549 for 1,001–1,500 km, ₹749 for 1,501–2,000 km, and ₹899 for distances above 2,000 km.

The changes will be applicable across Air India and Air India Express flights from 0901 hrs IST on April 8.

On international routes, however, the airline said it will implement steeper revisions to fuel surcharges due to the absence of any price mitigation mechanism for global ATF rates.

Citing data from the International Air Transport Association (IATA), Air India said global average jet fuel prices nearly doubled to $195.19 per barrel for the week ended March 27 from $99.40 at the end of February.

“ATF, produced by refining crude oil, has seen simultaneous increases in both its crude oil component as well as the refinery margin, known as ‘crack spread’, with the latter having nearly tripled within three weeks,” Air India said in a statement while announcing the revised fuel surcharge.

As per the revised international surcharge structure, passengers flying to SAARC destinations (excluding Bangladesh) will pay $24 per sector, while those travelling to West Asia will be charged $50.

Surcharges for Southeast Asia and China (excluding Singapore) have been set at $100, and $60 for Singapore.

Higher charges apply for long-haul routes, with passengers to Africa paying $130, Europe (including the UK) $205, and North America and Australia $280 per sector.

The revised rates for most international routes will come into effect from April 8, while those for Europe, North America and Australia will apply from April 10.

The airline said the revised surcharges still do not fully offset the steep rise in fuel costs and that it continues to absorb a “significant portion of the increased cost.”

“For the avoidance of doubt, tickets that have already been issued prior to the above times will not attract the new surcharge unless customers seek date or itinerary changes that require a recalculation of the fare,” it added.

The move comes days after budget carrier IndiGo also raised fuel surcharges on domestic and international routes for bookings made from April 2.

IndiGo has similarly shifted to a distance-based fuel surcharge for domestic routes, and imposed higher levies on international routes across regions.

For domestic routes, IndiGo passengers will now pay an additional ₹275 per sector for flights up to 500 km, ₹400 for 501–1,000 km, ₹600 for 1,001–1,500 km, ₹800 for 1,501–2,000 km, and ₹950 for distances above 2,000 km.