The ongoing West Asia conflict has impacted fuel rates and resulted in LPG crisis in India. With an increase in the jet fuel prices, flyers are likely to witness higher airfares.
Officials shared that airfares are expected to rise with the steep increase in jet fuel prices as airlines would have to increase fares to cover the higher operational costs. The steep price hike would add to the spiralling operational costs, which airlines are already facing headwinds due to the West Asia conflict that started on February 28.
Aviation Turbine Fuel (ATF) accounts for around 40 per cent of an airline's operational costs. The price ATF has reportedly more than doubled to a record Rs 2.07 lakh per kilolitre on Wednesday, and this is the first time that the jet fuel price has crossed the Rs 2 lakh per kilolitre mark.
From Air India to Spice Jet: Here's a list of airlines hiking ticket prices amid West Asia conflictWith increasing fuel prices, last month, Indian carriers imposed fuel surcharges on tickets.
On Tuesday, the International Air Transport Association (IATA) said that airfares are already rising in the wake of the West Asia turmoil.
"... without knowing the length and intensity of the war in the Middle East, it is impossible to quantify the full impact that it will have on airline prospects. But some things are already clear. Fuel costs have risen sharply. With tight capacity and thin margins, airfares are already rising," IATA Director General Willie Walsh informed the news agency on Tuesday.
IATA is a global grouping of around 350 airlines, including Air India, IndiGo, Air India Express and SpiceJet.