Domestic Flight Operations Face Cuts as Airlines Respond to Fuel Costs and Lower Demand

Air India and IndiGo are set to reduce domestic flight operations from 1 June for 90 days, as airlines respond to rising Aviation Turbine Fuel (ATF) prices and lower seasonal demand.

According to a report, the two carriers, which together account for more than 90 per cent of India’s aviation market, are scaling back selected services amid rising operating costs and softer travel demand following the school holiday season.

Air India is expected to reduce its domestic operations by up to 15 per cent, while IndiGo plans to cut between 5 and 7 per cent of its services during the period.

A senior Air India source said that domestic ATF prices have increased from around Rs 80,000 per kilolitre to over Rs 1 lakh in several cities due to varying VAT rates imposed by state governments. The source added that the airline would reduce frequencies on selected routes rather than suspend routes entirely.

Air India later confirmed that it has temporarily rationalised operations on certain domestic routes between June and August 2026. The airline said the move follows previously announced adjustments to parts of its international network and is intended to manage the impact of high fuel prices on operations.

The airline stated that affected passengers would be offered alternative flights, complimentary date changes, or full refunds where applicable.

Routes from Mumbai to Ahmedabad, Nagpur, Patna and Bhopal are among those expected to see reduced frequencies. Flights from Delhi to Hyderabad, Bengaluru and Kolkata are also likely to be affected.

Sources said the reduction in international services has also contributed to lower demand for domestic connecting flights through hubs such as Delhi and Mumbai.

IndiGo is also expected to scale down operations from 1 June through the end of August. According to airline sources, the period after academic holidays traditionally sees lower passenger demand, leading carriers to adjust capacity.

The Tata Group-owned Air India had recently announced temporary reductions in select international operations, citing airspace restrictions in certain regions and higher jet fuel prices.

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