Air India to Raise Fares on Flights as Global Oil Prices Surge

New Delhi: Amid the ongoing conflict between Iran, Israel, and the United States, oil prices have surged across the globe, and the airline industry is now feeling the impact. Air India has announced that it will levy a surcharge of ₹399 on domestic flight tickets starting March 12.  

Air India has confirmed that passengers travelling on international routes will also face higher fuel surcharges. The revised charges will be introduced gradually, depending on the route and ticket category. The airline said the decision was taken reluctantly but has become necessary due to factors beyond its control. According to Air India, the sharp rise in aviation fuel prices has significantly increased operating costs.  

Can There be Flight Reductions? 

Air India also warned that if such surcharges are not implemented, some routes may become financially unsustainable. In such situations, the airline may have to cancel certain flights if the operating costs cannot be covered.

The cost of fuel has increased dramatically in the last few weeks. Since the end of last month, gasoline prices have increased by almost 32%, diesel by 56%, and kerosene by almost 80%, according to data from major fuel trader Petrolimex.

How the Iran War Has Affected Fuel Prices Worldwide

The conflict involving Iran resulted in significant disruptions in global energy markets, pushing oil prices sharply higher and raising concerns about prolonged supply shortages. Since the conflict started, oil prices have increased by more than 25% worldwide, and economists caution that if shipping bottlenecks persist, prices might rise past $100 per barrel.

The Strait of Hormuz, a vital route for international oil supplies, is a major source of concern. Some of the largest oil producers in the Middle East have been forced to halt shipments due to supply disruptions caused by attacks on ships and energy infrastructure in the area. The closure of shipping lanes has affected nations including Saudi Arabia, the United Arab Emirates, Iraq, and Kuwait, stopping the flow of millions of barrels of oil.

According to analysts, the interruptions have also blocked the flow of oil tankers, damaged equipment, and forced refinery shutdowns, all of which have caused concern in the world's energy markets. Long-term disruptions, according to economists, may result in both slower global economic development and higher fuel prices.