Air India Cuts Domestic Flights Amid Rising Fuel Costs and Global Tensions

New Delhi, May 2026 : Air India has announced a reduction in the frequency of select domestic flights between June and August as the loss-making carrier moves to control costs amid a sharp rise in aviation fuel prices triggered by geopolitical tensions in the Middle East.

In a statement issued on Wednesday, the Tata Group-owned airline said the decision follows earlier adjustments made to its international operations.

“In continuation of our previously announced adjustments to select international services between June and August 2026, we have temporarily rationalised operations on certain domestic routes during the same period, with a reduction in frequencies on select routes,” the airline said.

The move is part of a broader cost-cutting strategy as Air India faces mounting financial pressure. The airline is expected to trim nearly 20 per cent of its domestic flight operations, which will help reduce fuel consumption—an expense that accounts for roughly 40 per cent of its total operating costs.

An airline official said that the cost of aviation turbine fuel has surged significantly in recent months, making several routes financially unsustainable. The price of jet fuel, which was around ₹80,000 per kilolitre before the Iran-related conflict escalation, has now crossed ₹1 lakh in many markets.

The official added that fuel prices also vary across states due to different VAT structures, further complicating operational planning and profitability on certain routes.

According to airline officials, reduced international operations have also impacted domestic connectivity. With fewer global flights, the demand for feeder services to major hubs like Delhi and Mumbai has declined, adding further pressure on domestic load factors and prompting additional route rationalisation.

Currently, Air India operates approximately 4,400 weekly flights, including about 3,600 domestic and 800 international services. The airline said it will continue to monitor demand patterns and operational conditions closely and restore frequencies once the situation stabilises.

“Air India will continue to monitor demand and operating conditions closely, with a view to restoring frequencies as conditions stabilise,” the statement added.

The airline also assured passengers affected by the schedule changes that alternative arrangements will be provided. Options include rebooking on other flights, complimentary date changes, or full refunds, depending on passenger preference and availability.

The financial strain on Air India has intensified in recent quarters. The carrier is reported to have posted a loss of around ₹26,800 crore for FY 2025–26, marking a sharp increase compared to the previous year. This has put additional pressure on its parent company, the Tata Group, to consider further capital infusion and restructuring measures.

Industry observers say that rising fuel costs, global uncertainty, and weakening demand on key routes have forced the airline to adopt aggressive cost-control measures. Analysts also note that while the short-term impact includes reduced connectivity, the airline is prioritising financial stability as it continues its long-term turnaround strategy.

With operational adjustments now extending across both international and domestic networks, Air India’s restructuring reflects the broader challenges facing global aviation amid geopolitical instability and volatile energy markets.

(The content of this article is sourced from a news agency and has not been edited by the Mavericknews30 team.)