Leading Indian airlines have begun hiking the fuel surcharges on domestic and international flights as the ongoing conflict between Iran and the US-Israel bloc sends aviation turbine fuel (ATF) prices spiraling. IndiGo made the latest such move on Friday.
The global prices of ATF, which typically accounts for 40% of an airline’s operating expenses, has seen a “sharp surge” since early March 2026 due to regional supply interruptions.
How prices are being increased | List and details
IndiGo: India’s largest carrier said it will begin levying a sector-based fuel charge on all domestic and international tickets starting March 14, 2026. The airline noted that while fully offsetting the ATF surge would require a “substantial adjustment” to base fares, it has opted for a smaller charge to benefit flyers. The sector-wise charges are:
- Domestic & Indian Subcontinent: ₹425
- Middle East: ₹900
- Southeast Asia & China: ₹1,800
- Africa & West Asia: ₹1,800
- Europe: ₹2,300
Air India group: Air India and AI Express announced a phased rollout of surcharges that began on March 12, 2026. The group warned that without these adjustments some flights would become economically unviable.
- Phase 1 (from March 12): A surcharge of ₹399 applies to domestic and SAARC routes. West Asia/Middle East routes attract a $10 surcharge, while Southeast Asia charges rose from $40 to $60.
- Phase 2 (from March 18): Surcharges on long-haul routes will increase significantly: Europe will rise to $125, while North America and Australia will jump to $200.
- Phase 3: Future adjustments are planned for Far East markets, including Japan and South Korea.
Others: Budget carrier SpiceJet warned that airlines have little choice but to impose surcharges if oil remains high. Founder Ajay Singh has urged the government to reduce excise duties and VAT on jet fuel, noting that prices even at $90 per barrel are becoming unsustainable. AirAsia, another low-cost carrier, confirmed it has raised fares and adjusted fuel surcharges, though it has not yet specified the exact sector-wise hikes.
Why are airfares spiking globally?
This domestic price jump reflects a volatile global market. Jet fuel prices have roughly doubled since the conflict began on February 28.
Beyond fuel costs, the industry is grappling with major flight disruptions.
Many carriers are avoiding the West Asian and adjacent airspace due to security concerns, leading to longer, more expensive alternative routes. Aviation analytics firm Cirium reported that more than 43,000 flights to and from the Middle East were cancelled between February 28 and March 10.
Among international carriers, Cathay Pacific plans to double its passenger fuel surcharges on long-haul flights to HK$1,164 starting March 18; Hong Kong Airlines is raising surcharges by up to 35.2%; Finnair has cancelled all flights to Doha and Dubai through the end of March and is incorporating fuel costs directly into base ticket prices; Air New Zealand has suspended its earnings forecast and warned of further fare and route adjustments; while Qantas, SAS Scandinavian Airlines, and Thai Airways have also confirmed fare increases or temporary surcharges to mitigate the impact.
