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:
Phase 1: Domestic flights and routes to the South Asian Association for Regional Cooperation (SAARC) — which includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka — will see fares increase by Rs 399 per ticket
Phase 2: Fuel surcharge will be increased on several international routes, including West Asia ($10), South East Asia ($20) and Africa ($30)
Phase 3: The surcharge will later be extended to Far East destinations such as Hong Kong, Japan and South Korea, with details to be announced later
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.
Since early March, ATF prices have risen sharply due to supply disruptions linked to the geopolitical situation in the Gulf region, pushing up operating costs for airlines.
The impact is particularly severe in India because ATF attracts high excise duty and VAT, especially in major metro cities such as Delhi and Mumbai, which further increases the cost burden for airlines.
The airline clarified that tickets issued before the surcharge implementation will not be affected, unless passengers make changes to their travel dates or itineraries that require recalculating the fare.
Air India said the surcharge is necessary to maintain operations.
“Absent such fuel surcharges, it is likely that some flights would be unable to cover operating cost and would have to be cancelled,” the airline said.
The carrier added that it will review the surcharge periodically and adjust it depending on how fuel prices and the geopolitical situation evolve.
The group also noted that Air India Express currently does not levy fuel surcharges on any of its flights, though the broader surcharge announcement covers flights operated by the airline as well.
Source India Today