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Air India Hikes Fuel Surcharges in Phases Amid Gulf Crisis, Rising ATF Costs

Air India has announced a phased expansion of fuel surcharges on its domestic and international routes, citing a steep rise in jet fuel prices driven by the geopolitical situation in the Gulf region. The new charges, applying to bookings from March 12 and March 18, introduce a Rs 399 fee for domestic and SAARC routes and increase existing surcharges on long-haul flights to Europe, North America, and Australia. The airline attributes the pressure to significant aviation turbine fuel (ATF) price escalation, amplified in India by high taxes in major metros. Air India stated that without these surcharges, some flights might become economically unviable and face cancellation.

Key Points: Air India Raises Fuel Surcharge on Domestic & Int'l Flights

  • Phased surcharge rollout from March 12
  • Domestic & SAARC routes get new Rs 399 fee
  • Surcharges to Europe, US, Australia rising sharply
  • High Excise Duty & VAT amplify cost pressure
  • Existing tickets exempt unless changed
2 min read

Air India announces phased expansion of fuel surcharge on domestic, international routes amid West Asia crisis

Air India announces phased fuel surcharge hikes on domestic & international routes due to soaring jet fuel prices from the West Asia crisis. Details here.

"Air India regrets the need to increase fuel surcharges... but emphasises that it is necessitated by factors outside its control. - Air India Statement"

New Delhi, March 10

Air India on Tuesday announced a phased expansion of fuel surcharges on both domestic and international routes and said the step has been necessitated by a steep rise in jet fuel prices arising from the geopolitical situation in the Gulf region.

In a statement, the airline said aviation turbine fuel (ATF), which accounts for nearly 40 per cent of an airline's operating costs, has witnessed a significant price escalation since early March 2026 due to supply interruptions.

"In India, this pressure is amplified by high Excise Duty and VAT on ATF in major metro cities such as Delhi and Mumbai, magnifying cost....and placing substantial strain on airline operating economics," the statement said.

According to the statement, the new fuel surcharge will be implemented in three phases and will apply to travel on all flights, including those operated by Air India Express.

The first phase will apply to all new bookings made from March 12. Under this phase, domestic routes within India and flights to SAARC countries will see a fuel surcharge of Rs 399, which was previously not applied. Flights to West Asia and the Middle East will carry a surcharge of USD 10. For Southeast Asia routes, the surcharge will rise from USD 40 to USD 60, while flights to Africa will see the surcharge rise from USD 60 to USD 90.

The airline also clarified that flights to and from Singapore currently do not attract a fuel surcharge but it shall apply from Phase 1.

Phase 2 of the surcharge expansion will take effect for bookings made from March 18. Fuel surcharges on flights to Europe will increase from USD 100 to USD 125. For routes to North America and Australia, the surcharge will increase from USD 150 to USD 200.

A third phase, covering Far East markets including Hong Kong, Japan and South Korea, will be announced in due course, the release said.

Air India said tickets already issued before the implementation times will not attract the new surcharge unless passengers request date or itinerary changes that require a recalculation of fares.

"Air India regrets the need to increase fuel surcharges in this manner but emphasises that it is necessitated by factors outside its control. Absent such fuel surcharges, it is likely that some flights would be unable to cover operating costs and would have to be cancelled," the statement said.

The airline added that it will review surcharges periodically and make appropriate adjustments as the situation requires.

- ANI

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Reader Comments

P
Priya S
While I understand the global situation, a phased increase feels like they're testing the waters to see how much we'll tolerate. My annual trip to visit family in Dubai just got more expensive. Hope other airlines don't follow suit immediately.
A
Aman W
The communication is clear, I'll give them that. At least they're not springing it on last-minute bookings. Time to book my summer travel to Europe before March 18th! ✈️
S
Sarah B
As someone who flies frequently between Mumbai and Singapore for work, the new surcharge on that route is a significant added cost. The geopolitical instability is affecting everything. Hope for peace in the region soon.
V
Vikram M
It's a tough situation. Airlines can't operate at a loss. But I do wish Air India, as our national carrier, would absorb a bit more of the shock or find operational efficiencies elsewhere before passing the entire burden to passengers.
K
Karthik V
The state VAT on fuel in cities like Delhi and Mumbai is indeed very high. This is a good moment for state governments to provide some relief. Aviation is crucial for business and tourism. Why tax it so heavily?

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