The escalating conflict between the United States and Iran, which has drawn in several Gulf nations, could soon reflect in higher airline ticket prices in India, as rising global crude oil rates threaten to increase aviation turbine fuel (ATF) costs — the single largest expense for airlines.

Since February 28, when the US and Israel launched strikes on Iran, benchmark Brent crude prices have climbed from around $72.48 per barrel to nearly $80. The spike has heightened concerns across the aviation industry, which is highly sensitive to fuel price fluctuations.

According to industry experts, ATF accounts for nearly 30–40 percent of an airline’s operating expenses and can make up to 45 percent of the airfare structure. With fuel prices being revised regularly based on international benchmarks and currency movements, any sustained rise in crude could significantly impact airline costs.

Govind Gaur, CEO of travel platform WanderOn, said domestic airfares could increase by around 10–15 percent if elevated oil prices persist. He noted that international routes are already witnessing price pressures due to airspace closures and cancellations, while early signs of rising fares are emerging on busy domestic sectors such as Delhi–Mumbai, Bengaluru–Delhi and Mumbai–Hyderabad.

The situation has been further complicated by tensions in the Strait of Hormuz, a critical global shipping route that carries nearly 50 percent of India’s oil imports and about 20 percent of global crude shipments. Reports suggest tanker traffic in the region has slowed significantly, forcing rerouting of supplies, which could increase transportation costs and put further upward pressure on oil prices.

With ATF prices nearing Rs 1 lakh per kilolitre in major Indian metros, airline operating margins are already under strain. Industry leaders warn that airlines, which typically operate on thin margins, may have limited room to absorb higher fuel costs and could pass on part of the burden to passengers.

“When operating costs rise due to higher fuel prices, airlines usually adjust fares across their entire network rather than only on international routes,” an industry representative said, indicating that even domestic passengers may face higher ticket prices if the conflict continues.

However, not all travel platforms are reporting a broad-based increase yet. Bharatt Malik, senior vice president for air and hotel business at Yatra Online, said domestic pricing trends currently remain stable and no systemic rise has been observed so far.

The escalation comes at a crucial time as India enters the peak summer travel season, marked by school holidays and increased leisure travel demand. During such high-demand periods, even moderate increases in fuel costs can quickly translate into higher fares on busy routes.

Industry executives describe the situation as a delicate balancing act for airlines — absorbing higher costs risks eroding profitability, while sharply raising fares could dampen travel demand.

With West Asia remaining one of the world’s most vital oil supply regions, a prolonged conflict could keep crude prices elevated for an extended period. If that happens, Indian travellers may face higher fares, fewer discounts and tighter seat availability in the weeks ahead.