Air India cuts international fuel surcharge as oil prices ease

Air travellers are expected to get some relief on international fares after Air India reduced its fuel surcharge on overseas routes from July 1, following a decline in global crude oil prices. Other airlines are also expected to lower fares in line with government norms requiring the benefit to be passed on to passengers.

Crude oil prices fell below $70 per barrel on June 30, their lowest level since the West Asia conflict began on February 28, The New Indian Express reported.

According to sources, Air India has reduced the fuel surcharge by about 38% on flights to Europe and the United Kingdom, while the surcharge on routes to Australia and North America has been cut by around 28.5%.

Sources said the reduction would be reflected in ticket prices, adding that even a modest percentage cut could translate into significant savings for passengers purchasing expensive international tickets.

Air India had increased its fuel surcharge in April to $205 per passenger for Europe and the UK and $280 for North America and Australia. The revised rates have now been lowered to $125 and $200, respectively, with sources describing the reductions as substantial.

While IndiGo did not officially comment, sources indicated that the airline would also be expected to reduce international fares, as government guidelines require airlines to pass on cost savings to customers.

Air India Express said it would respond later regarding any fare revision.

SpiceJet, which operates international services to Dubai, said the surcharge reduction did not apply to it because the airline had not increased international fuel surcharges during the peak of the West Asia crisis.

The price of domestic aviation turbine fuel also declined on July 1, falling from about ₹1.25 lakh per kilolitre to around ₹1.10 lakh per kilolitre. However, airline sources said this reduction was unlikely to result in lower domestic airfares.

Separately, Air India Express announced the restoration of services across its West Asia network with the resumption of flights to Salalah in Oman and Kuwait. The airline said flights between Kozhikode and Salalah resumed on July 2, Kozhikode and Kuwait services restarted on July 3, and Bengaluru–Kuwait flights will begin on July 4, with frequencies set to increase in phases. The Kozhikode–Salalah route will operate twice a week, while the Kozhikode–Kuwait service will initially operate once a week.