Aviation Turbine Fuel (ATF), the jet fuel used by commercial airlines, has become costlier for domestic carriers for the second consecutive month, with prices rising by 5.46%, or Rs 6.28 per litre, to Rs 121.28 from Rs 115, effective September 1. The latest increase adds to the operating costs of domestic airlines and could put upward pressure on flight ticket prices, although it does not automatically mean passengers will see a fixed increase in fares.
The impact will depend on factors such as passenger demand, competition, route capacity and how much of the additional fuel cost airlines choose to absorb. The latest hike follows a Rs 5-per-litre increase on August 1, when ATF prices rose from Rs 110 to Rs 115 per litre, after prices had been reduced by Rs 5 per litre in July.
With two consecutive monthly increases, airlines are now facing higher fuel costs at a time when ATF already accounts for a significant share of their overall operating expenses. The latest revision has been based on international benchmark prices and foreign exchange movements.
Fuel Costs Rise
The September 1 revision means domestic airlines will now pay Rs 121.28 for every litre of ATF, compared with Rs 115 previously. In percentage terms, the increase is 5.46%, representing a rise of Rs 6.28 per litre. For airlines operating thousands of flights and consuming large volumes of jet fuel, even a relatively small increase per litre can translate into a significant rise in overall operating expenditure.
ATF is among the biggest expenses for an airline, accounting for around 35–40% of operating costs in India. As jet fuel becomes more expensive, airlines face higher costs for operating their flights. One possible consequence is an increase in airfares if carriers decide to pass some of the additional expense on to passengers. However, the Rs 6.28-per-litre increase does not mean flight tickets will automatically become costlier by a fixed amount.
The eventual impact on passengers will depend on several factors, including the distance of the flight, fuel consumption, passenger demand, competition between airlines and the availability of seats on a particular route. Airlines could absorb some of the additional cost to remain competitive, while others may pass a portion of it on through higher ticket prices. As a result, passengers may see different fare movements across airlines and routes rather than a uniform increase across all domestic flights.
The latest hike therefore adds pressure to airline finances without guaranteeing an immediate fare increase. However, if ATF prices continue to rise in the coming months, airlines could find it increasingly difficult to absorb the additional expense, potentially making higher airfares more likely.
Second Monthly Hike
The latest increase follows the Rs 5-per-litre hike implemented on August 1, which took ATF prices from Rs 110 to Rs 115 per litre. Before that, jet fuel prices had been reduced by Rs 5 per litre in July, offering airlines some relief before prices began rising again.
With the September increase, ATF has risen by a total of Rs 11.28 per litre from the July level. The back-to-back increases mean airlines are dealing with higher fuel costs for the second consecutive month, reversing some of the relief they received from the July reduction.
ATF prices are revised on the first day of every month by state-owned oil marketing companies, including Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation. The revisions are linked to average international benchmark fuel prices and foreign exchange rates. Prices can also differ across cities because of local taxes such as VAT.
The latest increase comes against a backdrop of volatility in global energy markets. International crude oil prices and concerns over energy supplies can influence the cost of aviation fuel in India. If global fuel prices remain under pressure, domestic airlines could face further increases in their fuel bills in the months ahead.
For passengers, however, it is important to distinguish between rising ATF prices and an automatic rise in flight tickets. Airfares are dynamic and are influenced by multiple factors beyond fuel costs. Airlines may adjust fares according to demand, competition, route capacity and booking patterns. This means the effect of the latest ATF hike on passengers may become visible gradually rather than through an immediate, uniform increase in ticket prices.
The Logical Indian’s Perspective
The latest ATF increase highlights how global energy markets can eventually affect something as routine as booking a flight. For airlines, higher fuel costs can put pressure on finances and make it more challenging to maintain affordable fares. For passengers, particularly those travelling for work, education, family commitments or essential reasons, repeated increases in airfares could make air travel less accessible. At the same time, airlines operate in a highly competitive environment and cannot necessarily pass every additional expense directly on to consumers.
A balanced approach is therefore needed—one that recognises the financial pressures faced by carriers while keeping passenger affordability, transparency and fair pricing at the centre of the conversation. As airlines navigate rising fuel costs, how should they and policymakers balance the financial sustainability of the aviation sector with the need to keep air travel affordable for ordinary passengers?
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ATF (Aviation Turbine Fuel) prices for domestic airlines increased by Rs 6.28/litre to Rs 121.28/litre from Rs 115.00, say IOCL sources.
— ANI (@ANI) September 1, 2026
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