We are not recovering even the operating cost on most flights.
When the cost of flight itself becomes unsustainable, an airline must choose between shrinking and disappearing. Air India's decision to cut nearly 100 daily flights in June — as global jet fuel prices climb 80 percent in two months to $179.46 per barrel — is not merely a corporate adjustment but a reminder of how thin the margin between mobility and stillness truly is. The airline, the industry, and the government are each searching for footing on ground that keeps shifting beneath them.
- Jet fuel has surged 80% since February, pushing Air India past the point of cost recovery on most of its flights and forcing a reduction of nearly 100 daily departures to Europe, North America, Australia, and Singapore.
- The entire Indian aviation sector is sounding alarms — the Federation of Indian Airlines has formally warned the Ministry of Civil Aviation that the industry is under extreme stress and cannot absorb further price increases.
- Air India is unbundling meals and lounge access to claw back margins, offering passengers small discounts in exchange for stripped-down service — a visible sign of an airline running out of room to maneuver.
- The government responded on May 1 by cutting export duties on aviation turbine fuel from 42 to 33 rupees per liter, but the relief is set to expire in two weeks — a band-aid the industry says will not hold if prices stay elevated.
- Passengers face a June landscape of fewer routes, reduced services, and higher fares, caught between an airline that cannot afford to fly and a traveler who may choose not to.
Air India is preparing to remove nearly 100 flights from its daily schedule beginning in June, targeting international routes to Europe, North America, Australia, and Singapore. The cause is a fuel crisis that has pushed global jet fuel prices from $99.40 per barrel in late February to $179.46 by late April — an 80 percent surge that has left the airline unable to recover its operating costs on most flights. A senior official has confirmed that further cuts are possible if prices do not ease.
To survive the squeeze, Air India is restructuring what passengers pay for. Meals will become optional on domestic and shorter international flights, with savings of over 250 rupees passed to those who opt out. Business class travelers will face similar choices around lounge access. These are not minor tweaks — they reflect an airline methodically stripping away every cost it can.
The broader industry is equally alarmed. The Federation of Indian Airlines, representing Air India, IndiGo, SpiceJet, and others, has written to the Ministry of Civil Aviation seeking emergency relief: a temporary excise duty deferment on aviation turbine fuel, VAT reductions in key states, and the reinstatement of a pre-crisis pricing formula. The government responded on May 1 by reducing export duties on ATF from 42 to 33 rupees per liter, but the measure is set to last only two weeks.
What the crisis lays bare is the fundamental fragility of airline economics. Carriers cannot simply pass fuel costs onto passengers without losing them entirely. They cannot absorb the losses indefinitely. So they cut, strip, and wait — and in June, travelers will feel the consequences directly, in fewer choices and higher prices on the routes that remain.
Air India is about to cut nearly 100 flights from its daily schedule. The airline currently operates around 1,100 flights each day across domestic and international routes, but starting in June, passengers heading to Europe, North America, Australia, and Singapore will find fewer options. The reason is simple and brutal: jet fuel has become too expensive to fly.
Global jet fuel prices have climbed 80 percent since the end of February, rising from $99.40 per barrel to $179.46 by late April. That kind of surge doesn't leave room for negotiation. A senior Air India official put it plainly: the airline is no longer recovering its operating costs on most flights. If prices stay high, more cuts will follow.
The airline is not waiting passively. It is preparing to make meals optional on domestic flights and shorter international routes, allowing passengers who skip the meal to save more than 250 rupees on their ticket. Business class passengers will face similar choices with lounge access—opt out and get a cheaper fare. These are not cosmetic changes. They are the visible signs of an airline squeezing every margin it can find.
The timing makes the pressure worse. Oil marketing companies are scheduled to revise jet fuel prices again on Friday, a prospect that has the entire industry bracing for impact. The Federation of Indian Airlines, which represents Air India, IndiGo, SpiceJet, and other carriers, has already written to India's Ministry of Civil Aviation warning that the sector is under extreme stress. The group is asking for urgent government help: a temporary deferment of excise duty on aviation turbine fuel, reductions in value-added tax in key states, and reinstatement of a pricing formula that had been agreed upon before the current crisis.
The government has moved, but cautiously. As of May 1, it reduced export duties on diesel and aviation turbine fuel. The export duty on ATF dropped from 42 rupees per liter to 33 rupees per liter. On diesel, it fell from 55.5 rupees to 23 rupees per liter. These are real reductions, but they are temporary—set to last only two weeks. The industry is signaling that temporary measures will not be enough if fuel prices remain elevated.
What makes this moment distinct is that it exposes the fragility of airline economics. When fuel costs spike, airlines cannot simply raise ticket prices without losing passengers to competitors or to the choice not to travel at all. They cannot absorb the cost. So they cut routes, strip services, and hope the crisis passes. For passengers in June, the choice will be fewer flights to the destinations they want to reach, or paying more for the privilege of flying at all.
Citações Notáveis
We are not recovering even the operating cost on most flights. A sustained increase will force us to cut more.— Senior Air India official
The sector is under extreme stress amid the ongoing West Asia crisis.— Federation of Indian Airlines, in letter to Ministry of Civil Aviation
A Conversa do Hearth Outra perspectiva sobre a história
Why is Air India cutting flights now instead of just raising ticket prices?
Because they can't. If Air India raises prices too much, passengers book with competitors or don't fly at all. But fuel is a fixed cost they have to pay. So they cut capacity instead—fewer flights means lower total fuel spend, even if each flight still loses money.
The government reduced export duties. Doesn't that help?
It helps, but only at the margins. A two-week duty cut on ATF doesn't solve an 80 percent price surge. The industry is asking for something more structural—permanent changes to how ATF is taxed and priced. They're essentially saying: this is a crisis, not a normal market fluctuation.
What does unbundling meals actually accomplish?
It lets Air India capture some revenue from passengers who don't want the meal. Instead of baking the cost into every ticket, they're offering a discount for passengers willing to skip it. It's not much—250 rupees—but multiplied across thousands of flights, it adds up. It's also a signal: we're cutting costs everywhere.
Are other airlines doing the same thing?
The Federation of Indian Airlines is speaking as one voice to the government, which suggests the pressure is industry-wide. Air India is just the first to announce cuts publicly. Others are likely making similar moves behind the scenes.
What happens if fuel prices stay high through the summer?
More cuts. The official said it plainly: sustained increases will force deeper reductions. You could see entire routes disappear, not just fewer flights. That's when you start losing connectivity to major cities.