India’s two largest airlines scale back flight operations as the jet fuel crisis deepens.
Travel plans for thousands of UAE-based passengers are being disrupted as Air India and IndiGo scale back operations amid rising jet fuel costs linked to escalating tensions in the Iran conflict.
The reductions come during the peak summer travel season, when millions of Indian expatriates in the Gulf travel home for school holidays, family visits and onward international connections.
Air India and IndiGo together control nearly 90% of India’s domestic passenger market, making the capacity cuts particularly significant for travellers on the UAE–India route.
Sources familiar with the matter told Reuters that IndiGo has reduced around 7%–10% of its planned domestic flights for June and July, while Air India has cut about 22% of its scheduled domestic services. The sources were not authorised to speak publicly.
The reductions are expected to further constrain seat availability and keep airfares elevated on several routes during the peak travel season.
Fuel costs surge
The aviation sector has been significantly impacted by rising jet fuel prices amid disruptions linked to tensions in the Middle East.
Fuel typically accounts for as much as 40% of an airline’s operating costs, prompting carriers to increase fares, suspend less profitable routes and cut flight frequencies.
Air India said it had “temporarily rationalised operations on certain domestic routes” between June and August due to the continued pressure of elevated fuel prices on its operations.
The increase has been driven in part by disruptions around the Strait of Hormuz, a key global oil shipping route that connects Gulf energy producers to international markets. An Air India official said aviation turbine fuel prices for the airline have risen from around ₹80,000 per kilolitre before the Iran conflict to more than ₹100,000.
UAE travellers affected
The reduction in services is expected to have widespread knock-on effects for passengers in the United Arab Emirates, particularly those connecting via Delhi and Mumbai to smaller Indian cities or onward international destinations.
Air India said reduced international operations have lowered demand for domestic feeder flights into major hubs such as Delhi and Mumbai.
This could lead to fewer connection options and longer transit times for passengers travelling from the Dubai, Abu Dhabi and Sharjah.
The impact may extend beyond India-bound travel as well. Many residents in the United Arab Emirates use Indian hubs as lower-cost transit points for flights to North America, Europe and parts of Asia, and reduced long-haul schedules could further limit those options.
Air India has already suspended or reduced several international services through August.
Delhi–Chicago flights have been suspended, while Delhi–San Francisco services have been reduced from 10 weekly flights to seven. Services to destinations including Toronto, Vancouver, Paris, Singapore, Bangkok, and several other cities across Europe and Asia have also seen frequency cuts.
IndiGo, India’s largest airline by market share, has also been compelled to scale back capacity, despite continuing its broader expansion plans.
IndiGo operates more than 2,200 daily flights, including international services, but had already reduced some long-haul operations even before the Iran conflict due to operational constraints and airport congestion.
The latest capacity cuts underscore how vulnerable India’s fast-growing aviation market remains to external shocks, despite strong travel demand and major aircraft orders expected in the coming years.
Industry executives say airlines are increasingly focusing on profitability and fuel efficiency rather than rapid expansion, as operating costs continue to rise.
Fares likely to stay high
Travel industry analysts expect the reductions to keep ticket prices elevated across Gulf–India routes throughout the summer travel season.
Limited seat availability combined with strong seasonal demand from expatriate families travelling during school holidays could push fares even higher on popular routes.
The capacity cuts may also increase demand for Gulf carriers such as Emirates, Etihad Airways and flydubai, as passengers look for more stable schedules and direct international connections.
However, these airlines are also facing rising fuel costs amid ongoing disruptions in global energy markets.
Financial strain deepens
Air India’s operational cutbacks reflect broader financial pressure across the aviation sector.
The carrier recently reported an annual loss of more than $2 billion, driven not only by rising fuel costs but also by restrictions such as Pakistan’s continued ban on Indian airlines using its airspace, along with the strength of the U.S. dollar.
Air India is owned by the Tata Group and Singapore Airlines. The airline said affected passengers will be offered alternative flight options, complimentary date changes, or refunds where applicable.
It added that operations will continue to be reviewed based on fuel prices, demand patterns, and broader operating conditions.
Analysts caution that further changes remain possible if tensions in the Middle East continue to disrupt oil markets and aviation supply chains.
For travellers in the United Arab Emirates, this could translate into continued uncertainty over fares, flight schedules and seat availability extending beyond the summer travel period.
