Air India to levy fuel surcharge on domestic flights, hike it on international flights

For Air India’s flights to Southeast Asia and Africa, the existing surcharge will go up by 50% each to $60 and $90, respectively.

The second phase–bookings made from March 18–will cover Air India’s flights to Europe, North America, and Australia. The surcharge for flights to Europe will go up by 25% to $125, while for North America and Australia, it will increase by a third to $200.

“Phase 3 will apply to and from Far East markets, namely Hong Kong, Japan, and South Korea, which will be announced in due course. For the avoidance of doubt, bookings that have already been made prior to the above times will not attract the new surcharge unless customers seek date or itinerary changes that require a recalculation of the fare,” Air India said in a release.

“Since early March 2026, aviation turbine fuel (ATF), which accounts for nearly 40% of an airline’s operating costs, has seen significant price escalation due to supply interruptions. In India, this pressure is amplified by high Excise Duty and VAT on ATF in major metro cities such as Delhi and Mumbai, magnifying the impact and placing substantial strain on airline operating economics,” it said.

The airlines expressed regret over the need to expand fuel surcharges, and said that it is necessitated by factors outside its control. Without the fuel surcharges, some of its flights may not be able to cover operating costs and would risk cancellation, the airline said, adding that it will review its surcharges periodically and make appropriate adjustments as the situation requires.

In addition to the spurt in international jet fuel prices due to the conflict in West Asia, Air India’s flights to Europe and North America are also bearing the brunt of Pakistan’s ban on Indian airlines and aircraft from using its airspace, leading to significantly longer durations for these operations, which also leads additional fuel burn.

International prices of crude oil and fuels have jumped significantly over the last 10 days, ever since the raging conflict started after Israel and the US hit Iran with military strikes on February 28. With Iran retaliating by striking Israel and other Gulf countries that house American military assets, the war has expanded. The key reason for the spurt in energy prices is the effective halt in vessel movement through the Strait of Hormuz, a critical chokepoint for global energy supplies.

With oil and fuels supplies through the Strait effectively blocked due to threats of attacks from Iran, the global oil and fuels supply situation has tightened considerably, leading a significant increase in prices.