Govt shields domestic aviation sector from jet fuel spike, airfares likely to remain stable

New Delhi: The government on Wednesday said that domestic airfares are unlikely to see a sharp rise as it has cushioned the impact of a steep surge in aviation turbine fuel (ATF) prices by allowing only a partial increase for domestic airlines.

According to the Ministry of Petroleum and Natural Gas (MoPNG), ATF prices in India — deregulated since 2001 — are revised monthly based on international benchmarks. Given the current geopolitical situation, ATF prices for domestic markets were expected to rise by more than 100 per cent from April 1.

However, in a bid to shield domestic air travel costs from a steep spike, public sector oil marketing companies (OMCs), in consultation with the Ministry of Civil Aviation, have implemented only a partial and staggered increase.

Domestic airlines will face a limited hike of around 25 per cent, translating to approximately Rs 15 per litre, instead of the full pass-through of global price increases, the government said.

In contrast, airlines operating on international routes will bear the full increase in ATF prices, in line with global market-linked pricing.

Union Civil Aviation Minister Ram Mohan Naidu said the calibrated approach would help protect passengers and the aviation sector.

“This calibrated approach will help shield passengers from sharp fare increases, ease the burden on domestic airlines, and support the continued stability of the aviation sector at this crucial juncture,” he said.

He added that the move would also benefit the broader economy by ensuring smooth cargo movement and maintaining critical air connectivity for trade and logistics.

The decision comes amid a sharp escalation in global crude oil prices due to ongoing tensions in West Asia. Disruptions around the Strait of Hormuz — a critical artery for global energy trade — have pushed up fuel costs worldwide.

Prices of aviation turbine fuel (ATF), or jet fuel, in the national capital have seen an increase, though not as steep as initially reported, after a clarification from Indian Oil Corporation.

According to the oil major, ATF prices have risen by about 8.5 per cent, not 115 per cent as previously indicated. The current price of jet fuel stands at around Rs 1.04 lakh per kilolitre.

IANS