Aviation turbine fuel (ATF) prices have been raised for the third consecutive month, effective December 1, 2025, increasing operating costs for Indian airlines amid already strained finances. State-run oil marketing companies—Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL), and Hindustan Petroleum Corporation Limited (HPCL)—announced the hike based on the average international benchmark rates and prevailing foreign exchange levels, with ATF now priced at Rs 99,676.77 per kiloliter in Delhi, up from Rs 94,543.02 in November. This revision marks an average increase of Rs 5,113.75 per kiloliter across major metros, including Rs 93,281.04 in Mumbai, Rs 102,371.02 in Kolkata, and Rs 103,301.80 in Chennai.

The cumulative hikes over the past three months underscore a reversal from earlier stability in fuel pricing. In November, prices rose by about 1% or Rs 777 per kiloliter in Delhi; October saw a steeper 3.3% jump of Rs 3,052.5, while September brought a modest 1.4% cut of Rs 1,308.41. Such monthly adjustments, conducted on the first of every month, reflect fluctuations in global crude oil prices and the Indian rupee's value against the US dollar. Notably, domestic petrol and diesel prices have remained unchanged since mid-March 2024, when a minor Rs 2 per liter reduction was implemented ahead of general elections.

For airlines, the escalation poses significant challenges, as fuel constitutes nearly 40% of their total operating expenses in a highly competitive market. Carriers like IndiGo, Air India, and SpiceJet, which have grappled with rising costs post-pandemic, may pass on the burden through higher airfares, potentially dampening passenger demand during the winter travel peak. The aviation sector, already facing issues like aircraft groundings and supply chain disruptions, could see margins further squeezed without corresponding revenue growth.

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As India pushes for aviation expansion under initiatives like UDAN and international route liberalization, sustained high ATF costs highlight the need for policy interventions, such as reduced excise duties or hedging mechanisms. With global oil prices volatile due to geopolitical tensions, experts anticipate continued pressure on fuel rates, urging airlines to prioritize fuel-efficient fleets and operational efficiencies to mitigate long-term impacts.

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