Airfare Hikes Loom as Jet Fuel Prices Surge

Travelers should prepare for significant increases in airfare as jet fuel prices have surged following the Iran conflict. Domestic and international flight costs are expected to rise sharply, with airlines likely passing these expenses onto passengers. The financial strain on airlines could lead to reduced flight availability and cancellations on less profitable routes. As the situation unfolds, travelers may face higher costs and fewer deals, particularly during peak travel seasons. Stay informed about the evolving landscape of air travel costs and plan accordingly.

By Narendra Chaudhary Apr 1, 2026, 10:35 IST

Airfare Increases on the Horizon

New Delhi: Travelers should brace themselves for higher flight costs as airfares are projected to rise significantly due to a sharp increase in jet fuel prices. This surge follows the recent conflict in Iran, which has driven global oil prices upward. The cost of jet fuel, known as Aviation Turbine Fuel (ATF), has escalated dramatically this April:

Domestic flight fuel prices have soared by approximately 115%.
International flight fuel costs have risen by around 107%.

In Delhi, the price of ATF for domestic flights has surpassed Rs 2 lakh per kilolitre for the first time. For international flights, the cost has exceeded $1,000 per kilolitre, marking another unprecedented milestone for India.

Why This Matters

Fuel constitutes the largest expense for airlines, previously accounting for 40–45% of their total costs. With the recent price hikes, this percentage is expected to increase, leading to a significant rise in operational expenses that many airlines may find challenging to manage.

Airlines' Next Steps

Airlines have limited options moving forward. Here’s what is anticipated:

Increased airfares
Passing on the elevated fuel costs to passengers
Potential reduction in flight availability
Cutting unprofitable routes

Potential for Higher Fuel Surcharges

Carriers such as IndiGo, Air India, and Akasa Air had already implemented fuel surcharges last month, which may see further increases. Previously, there was a cap on domestic airfares set at Rs 18,000, but this was lifted in March 2026. Additionally, airlines have not received any government relief regarding fuel taxes, which remain high compared to international standards. Executives are cautioning that the full impact of these changes has yet to be realized.

Campbell Wilson, CEO of Air India, remarked, "The financial repercussions of the Iran crisis are still unfolding, as the spot price of jet fuel has more than doubled, with most effects expected to manifest next month.” He also indicated, "Depending on fluctuations in fuel costs, airfares, and customer demand, we may need to make adjustments.” He highlighted a significant challenge: "Not every traveler is prepared to pay higher fares, so there is a limit to how much we can increase prices before demand declines.”

Implications for Travelers

Travelers should anticipate:

Increased flight prices in the upcoming weeks
Possible reductions in flight frequency or cancellations on certain routes
A slowdown in travel demand if prices escalate excessively

Currently, passengers can expect more expensive flights and fewer promotional offers, particularly during busy travel seasons.