Govt creates aviation fuel price 'stabilisation fund' in bid to shield domestic passengers from Iran war impact
The Indian government has established a ₹10,000-crore fund to stabilize aviation fuel prices amid the ongoing West Asia crisis. This fund aims to support Indian airlines by providing interest-free advances to Oil Marketing Companies for Aviation Turbine Fuel (ATF) price stabilization. The initiative is expected to reduce fare volatility and maintain air connectivity across various regions in India.
- ▪The fund will provide budgetary support to Oil Marketing Companies to stabilize ATF prices for airlines.
- ▪ATF prices have surged from ₹60 per litre in March to ₹142 per litre in May 2026 due to the West Asia crisis.
- ▪The support will be in place for up to three years, with annual reviews and provisions for recovery when prices moderate.
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Govt allocates ₹10,000-crore fund to stabilise aviation fuel prices amid Iran warWhile ATF price has been capped for domestic operations, Indian carriers continue to purchase ATF for international operations at Import Parity Prices (IPP).Updated on: Jun 03, 2026 3:51 PM ISTBy Neha TripathiShare viaCopy link The Union cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved a one-time budgetary support of Rs10,000 crore for Oil Marketing Companies (OMCs) to provide Aviation Turbine Fuel (ATF) price stabilisation support to Indian airlines for both their domestic and international operations.ATF prices have risen 2.5 times, increasing from ₹60 per litre in March to ₹142 per litre in May 2026.
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