Government in Talks with Airlines, OMCs over High ATF Prices

The Civil Aviation Ministry is discussing elevated Aviation Turbine Fuel (ATF) prices with airlines and oil marketing companies (OMCs), Civil Aviation Minister K Rammohan Naidu said on Tuesday. The discussions come as the West Asia crisis places additional pressure on jet fuel costs and increases the operating burden for carriers.

ATF accounts for around 40 per cent of an airline’s operational costs, making fuel prices a significant factor in ticket pricing and carrier finances. Naidu said the ministry was engaging both airlines and OMCs on the impact of the recent increase in fuel prices.

The minister made the comments on the sidelines of a conference in New Delhi. He linked the pressure on ATF prices to the continuing crisis in West Asia, which has contributed to volatility in energy markets and created difficulties for the aviation sector.

The country’s largest airline, IndiGo, announced a fuel surcharge increase for domestic and international flights on Monday. The airline said ATF prices had remained volatile in recent months, particularly after developments in the Middle East.

IndiGo said the latest month-on-month increase in fuel prices had exceeded 14 per cent, taking ATF costs to among their highest levels in the past decade. The surcharge change reflects the immediate impact of higher fuel expenses on airline operations, while the ministry’s discussions indicate efforts to assess the wider effect on carriers and fuel suppliers.

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