Air India Group to Introduce Phased Fuel Fee, Raising Airfares.
Due to the significant increase in aviation turbine fuel (ATF) costs brought on by the ongoing geopolitical crisis in the Gulf region, the Air India Group announced that it will implement a phased fuel surcharge on its domestic and international flights. As a result, air fares are expected to climb.
Due to supply difficulties, ATF prices which make up about 40% of an airline’s operating costs have increased dramatically since early March 2026. High excise duty and VAT on ATF in key Indian cities like Delhi and Mumbai exacerbate cost pressures and further strain airline operational economics.
The updated fuel fee will be applied throughout the airline’s network and will be introduced in three stages. However, there are currently no fuel surcharges on any of Air India Express’s flights.
Phase 1: Commencing on March 12, 2026
For all new bookings made from 0001 hours IST on March 12, a fuel surcharge will be introduced on several routes. Domestic and SAARC routes would receive a cost of INR 399, while flights to West Asia and the Middle East will see a surcharge of USD 10. Surcharges will rise to USD 60 on flights to Southeast Asia and USD 90 for travels to Africa. Additionally, flights to and from Singapore, where it was not previously imposed, will be subject to the surcharge.
Phase 2: Commencing on March 18, 2026
Fuel surcharges for long-haul routes will be changed in the second phase, which will apply to reservations made starting at 0001 hours IST on March 18. There will be a cost of USD 125 for flights to Europe and USD 200 for flights to North America and Australia.
Phase 3: Routes to the Far East
There will be an announcement later on about a third phase that will include routes to the Far East, including South Korea, Japan, and Hong Kong.
The airline stated that unless travellers modify their travel dates or itineraries that need a pricing recalculation, tickets issued prior to the implementation dates will not be subject to the new surcharge.
According to Air India, the surcharge increase is required because of circumstances beyond the airline’s control. In the absence of these steps, some flights could find it difficult to fund operational expenses and might have to be cancelled.
The airline said it will examine surcharges frequently and alter them based on fuel price fluctuations and operating conditions.
