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West Asia disruptions, high fuel costs weigh on Indian aviation sector recovery: Report

  • BY India News Newsdesk
  • June 3, 2026
  • 0 COMMENTS

New Delhi, June 3 (IANS) Geopolitical tensions and disruptions arising from the ongoing West Asia crisis continue to weigh on the recovery of India’s aviation sector, impacting traffic, capacity deployment and overall industry profitability, a report showed on Wednesday.

International passenger traffic of Indian carriers remained under pressure in April 2026 at around 1.8 million passengers, down 39 per cent year-on-year and 1 per cent month-on-month.

Revenue Passenger Kilometres (RPKs) declined around 33 per cent year-on-year to 7.2 billion, while flight departures were down around 37 per cent year-on-year despite a marginal sequential recovery, according to the latest ‘Aviation Tracker’ report by Equirus Securities.

The report noted that capacity rationalisation persisted, with Available Seat Kilometres (ASKs) down around 28 per cent year-on-year.

However, demand weakness outpaced capacity cuts, leading to a sharp decline in passenger load factor (PLF) to around 75.5 per cent, down 617 basis points year-on-year and 735 basis points month-on-month.

“The data indicates that the adverse impact of the West Asia conflict continued through April, affecting both traffic volumes and network efficiency,” the report said.

Fuel costs remained elevated despite a sequential moderation. Brent crude stood at around $92 per barrel, up 44 per cent year-on-year, while Singapore jet fuel stood at around $128 per barrel, up 65 per cent year-on-year, said the report.

The rupee depreciation remained significant at around 95 against the US dollar, up 11 per cent year-on-year, increasing dollar-linked costs such as aircraft leases and maintenance expenses.

Moreover, domestic aviation turbine fuel (ATF) prices stood at around Rs 105.6 thousand per kilolitre, up 18 per cent year-on-year and 9 per cent month-on-month.

According to the report, government intervention continued to limit pass-through of global fuel inflation.

On the domestic front, passenger traffic declined to around 13.9 million passengers, down 3 per cent year-on-year and 4 per cent month-on-month. Capacity additions continued, with ASKs increasing around 3 per cent year-on-year, resulting in lower utilisation.

The West Asia crisis remains a key overhang for the aviation sector.

While airlines have undertaken capacity adjustments and route rationalisation measures, international operations continue to face pressure from disrupted travel patterns and lower demand, delaying a broader recovery in the segment, said the report.

–IANS

na/

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