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There is important news for air travelers. The price of Aviation Turbine Fuel (ATF) has been raised by 5.46% starting in September. Consequently, the price of ATF for domestic airlines has increased by ₹6,280, reaching ₹1,21,280 per kilolitre, up from the previous ₹1,15,000. Rising fuel costs can increase airline expenses and impact their overall operational costs. This situation could create pressure to hike airfares in the coming days.

While the rise in ATF prices creates pressure to increase flight ticket prices, it does not necessarily mean that fares will rise immediately or certainly. Fuel accounts for a significant portion of an airline's total costs; therefore, when ATF prices rise, companies may pass on some of the increased cost to passengers.

**ATF prices were also raised in August**
In August, Indian Oil Corporation had increased the price of Aviation Turbine Fuel (ATF) by ₹5 per litre. Following this, the price of ATF for domestic airlines rose from ₹110 to ₹115 per litre. It is worth noting that rising fuel prices inevitably increase airline expenses, as fuel constitutes approximately 40% of their total operational costs.

**Why were ATF prices increased?**
Rising tensions in West Asia have led to a surge in crude oil prices, which has impacted ATF prices as well, given that this fuel is derived from crude oil. An increase in ATF prices raises fuel expenses for airlines, putting pressure on their overall operating costs. This could eventually impact airline profits and share prices. Additionally, if companies pass on a portion of the increased costs to passengers, airfares could become more expensive. However, changes in airfares do not depend solely on ATF prices.

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