India’s domestic aviation sector is preparing for a leaner summer schedule as the country’s two largest airlines, Air India and IndiGo, move to reduce flight capacity amid surging fuel prices and mounting operational pressure due to the ongoing conflict in the Middle East. The cutbacks are expected to affect thousands of passengers during one of the busiest travel periods of the year.
According to reports citing industry sources, IndiGo plans to reduce its domestic flight schedule by around 7% to 10% during June and July, while Air India is expected to scale back domestic operations by nearly 22% over the same period. The reductions are being driven primarily by a sharp increase in aviation turbine fuel (ATF) costs following disruptions in global oil markets caused by the Iran conflict.
Fuel expenses already account for nearly 40% of airline operating costs in India, making carriers vulnerable to sudden spikes in crude oil prices. Over the past several weeks, global jet fuel prices have climbed dramatically as fears of supply disruptions through the Strait of Hormuz rattled energy markets. Analysts say the surge has made several domestic routes temporarily unprofitable, forcing airlines to rethink schedules and capacity deployment.
Air India confirmed that it has “rationalized” portions of its domestic network through August, describing the move as temporary. The airline said passengers affected by schedule changes would either be accommodated on alternate flights or offered refunds. The carrier has also been dealing with challenges on international routes due to airspace restrictions, longer flying times, and rising operating costs tied to the strong U.S. dollar.
For IndiGo, the decision adds to a difficult operational phase following major disruptions late last year linked to crew scheduling problems and regulatory adjustments. Although the airline remains India’s dominant carrier with a domestic market share close to 60%, rising fuel expenses and weaker-than-expected summer demand have added new financial strain.
The broader aviation environment in India has become increasingly difficult over the past few months. Apart from fuel costs, airlines are also grappling with geopolitical disruptions affecting international air corridors. Pakistan’s airspace restrictions, rerouting requirements, and congestion in Gulf aviation hubs have collectively increased flying times and operational complexity for Indian carriers.
Air India has faced especially heavy financial pressure. Reports earlier this year suggested the airline recorded losses exceeding $2 billion, driven partly by higher fuel bills, operational restructuring, and global aviation disruptions. The carrier has also already reduced some international operations in response to worsening market conditions.
Passengers are now being advised to book early and monitor schedule updates carefully as airlines adjust operations over the coming weeks. Travel industry analysts believe additional capacity reductions cannot be ruled out if geopolitical tensions continue or crude oil prices remain elevated through the summer.
