Commercial LPG and Jet Fuel Prices Soar in India Amid Global Crisis

On April 1, 2026, India's state-run oil marketing companies (OMCs) implemented significant price revisions for commercial liquefied petroleum gas (LPG) and aviation turbine fuel (ATF), impacting various sectors of the economy. The price of a 19kg commercial LPG cylinder, widely utilized by businesses such as hotels, restaurants, and hostels, saw an increase of ₹195.50 in Delhi, pushing its cost from ₹1,883 on March 7 to ₹2,078.50. This represented a 10.4% surge and marked the second such increase for commercial LPG in less than a month, with a previous hike of ₹114.50 occurring on March 7. Other major cities like Kolkata also experienced a significant rise, with a 19kg commercial LPG cylinder increasing by ₹218. Concurrently, aviation turbine fuel (ATF) prices witnessed an even steeper surge. For non-scheduled, ad-hoc, and charter domestic airlines, ATF prices more than doubled, increasing by an astonishing 114.55% to a record ₹207,341.22 per kilolitre in Delhi, up from ₹96,638.14 per kilolitre on March 1. This was the first instance where ATF prices crossed the ₹2 lakh per kilolitre mark, surpassing a previous peak in 2022. For international airlines, ATF prices also rose considerably by 107%, from $816.91 per kilolitre to $1,690.81 per kilolitre. The sharp escalation in fuel prices was primarily attributed to the deepening global energy crisis and escalating geopolitical tensions, particularly the ongoing conflict in West Asia and the resulting disruptions to global energy supply chains, including the blockade of the Strait of Hormuz. The Strait of Hormuz is a crucial waterway through which a significant portion of the world's crude oil passes, and its disruption triggered a substantial spike in international oil prices. However, in a significant move to mitigate the impact on domestic air travel, the Indian government intervened to partially moderate the ATF price hike for scheduled domestic airlines. Instead of the full 114-115% increase, these carriers faced a "partial and staggered" increase of approximately 8.5% or a 25% increase, bringing their effective ATF price to around ₹104,927 per kilolitre. This calibrated approach, undertaken by OMCs in consultation with the Civil Aviation Ministry, aimed to shield passengers from sharp fare increases and support the stability of the aviation sector. Foreign routes, however, continued to pay the full, higher international rates. In contrast to the commercial fuel segment, prices for domestic cooking gas (14.2 kg cylinder) remained unchanged for general consumers, holding steady at ₹913 in Delhi after a previous ₹60 hike on March 7. Similarly, the retail prices of regular petrol and diesel also remained constant, despite global crude oil prices increasing by almost 50%. The government and oil retailers continued to absorb significant under-recoveries to insulate domestic consumers from the volatility of international oil prices. The repeated increases in commercial LPG prices are expected to put additional cost pressures on small and medium businesses, particularly those in the food and hospitality sector, which rely heavily on bulk LPG. Airlines also face increased operating costs, as fuel constitutes a significant portion (around 40%) of their total expenses, potentially leading to higher airfares for consumers if not for the government's partial intervention for scheduled flights. The situation underscored India's vulnerability to global energy market fluctuations and its efforts to manage the domestic impact through targeted interventions. This series of price hikes reflects the monthly revision policy by state-owned OMCs—Indian Oil Corporation, Bharat Petroleum Corporation Limited, and Hindustan Petroleum Corporation Limited—which adjust ATF and LPG prices on the first day of each month based on international benchmarks and exchange rates.

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