Saudi oil crisis may push domestic air fares up by 10-15% by month end

Domestic airlines may have to hike fares two weeks ahead of the busy travel season if oil prices remain elevated over next few days.

“If the crude oil price keeps on rising we will have to decide on hiking airfares. We are closely monitoring the crude oil prices,” a senior Air India executive said on Monday.

The national carrier, which is already struggling with its fuel payments, spends around Rs 6,000-7,000 crore annually on fuel. A 10 per cent hike in crude price would mean over Rs 50-58 crore of extra costs for the airline.

Crude oil prices jumped nearly 20 per cent today before settling down to a 10 per cent rise with disruption in oil supplies following a drone attack on facilities in Saudi Arabia.