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Federation of Indian Airlines Urges Government to Overhaul ATF Pricing Formula
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News18•06-10-2026, 15:00
Federation of Indian Airlines Urges Government to Overhaul ATF Pricing Formula
- •The Federation of Indian Airlines has written to the Civil Aviation Ministry seeking a review of the current jet fuel pricing formula.
- •Airlines want domestic ATF to be priced on actual cost plus a reasonable margin rather than the international benchmark pricing.
- •Soaring fuel costs driven by geopolitical disruptions and rupee depreciation have pushed operating costs to 55-60 percent.
- •FIA warned that airlines may be forced to withdraw from several unsustainable routes if timely relief is not provided.
- •The industry has requested the government to continue relief measures such as VAT reductions and caps on ATF prices.
Key Questions Answered
The Federation of Indian Airlines (FIA) has requested the government to replace international benchmark pricing with a "Cost Plus" pricing model, where domestic aviation turbine fuel (ATF) is priced on the actual cost of fuel plus a reasonable margin.
The conflict in West Asia pushed Brent Crude from USD 72 per barrel to USD 118 per barrel, causing ATF prices (MOPAG plus premium) to surge from USD 87.24 to a high of USD 260.24 per barrel before trading at USD 175.33 per barrel.
Air India, IndiGo, and SpiceJet are the member airlines of the Federation of Indian Airlines (FIA).
