IndiGo announces fuel charge up to Rs 1,000 to offset rising ATF costs

6 Oct 2023 , 11:00 AM

IndiGo, India’s largest domestic carrier, said on October 5 that it will implement a fuel surcharge on domestic and international routes from October 6 to combat rising ATF prices.

The decision follows a major increase in Aviation Turbine Fuel (ATF) prices, which have risen significantly in the last three months, with monthly price increases, the carrier stated in a statement.

ATF accounts for a significant amount of an airline’s operating expenses, forcing rate adjustments to address such a cost spike. Under the new pricing system, travellers booking IndiGo flights will suffer a fuel charge, per sector, based on the sector distance, it noted.

On October 1, the government increased the price of jet fuel, or ATF, by 5%, marking the fourth consecutive monthly increase since July.

According to a price statement from state-owned fuel dealers, the price of aviation turbine fuel (ATF) in the national capital has increased by Rs 5,779.84 per kilolitre, or 5.1%, to Rs 118,199.17 per kl from Rs 112,419.33.

The rise follows the steepest-ever 14.1% increase (Rs 13,911.07 per kl) on September 1, as well as an 8.5% or Rs 7,728.38 per kl increase on August 1.

The fourth consecutive increase in jet fuel prices, which accounts for 40% of an airline’s operating costs, would place additional strain on already financially stressed carriers.

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