State-owned oil retailers implemented monthly price revisions on 1 January 2026, cutting the price of aviation turbine fuel (ATF) while raising commercial liquefied petroleum gas (LPG) rates, in a move that will ease pressure on airlines but increase costs for hotels and restaurants.
In Delhi, ATF was reduced by ₹7,353.75 per kilolitre, or 7.3 per cent, to ₹92,323.02 per kl. The reduction follows three successive monthly increases and neutralises more than two thirds of the rise seen since 1 October. Earlier increases included a ₹5,133.75 per kl rise on 1 December, a roughly 1 per cent adjustment on 1 November and a 3.3 per cent hike on 1 October.
Prices vary across cities because of local taxes. ATF in Mumbai was revised to ₹86,352.19 per kl, while Chennai and Kolkata saw rates fall to ₹95,770 and ₹95,378.02 per kl respectively. Fuel accounts for nearly 40 per cent of airline operating costs, so the cut is expected to provide some immediate relief to carriers, although airlines had not issued immediate comments on the impact.
India ATF price cut provides relief for airlines
The timing of the reduction is notable. Global crude prices have moderated over the past month, allowing refiners and marketers to pass on savings. Domestic carriers, which faced three rounds of price increases since October, will see operating costs ease as the new ATF rates come into effect at the start of the month.
Despite the ATF cut, consumers and businesses face higher cooking‑fuel bills. The price of a 19‑kg commercial LPG cylinder used by hotels and restaurants in Delhi was increased by ₹111 to ₹1,691.50. Commercial LPG prices have risen after two earlier monthly cuts; the recent hike places commercial cylinders at their highest level since June of the previous year.
By contrast, domestic LPG for household kitchens remains unchanged at ₹853 for a 14.2‑kg cylinder. That rate follows a ₹50 increase implemented in April 2025.
Petrol and diesel prices continue to be frozen at the pump after a reduction of ₹2 per litre in March last year. As of the price revision, petrol in Delhi costs ₹94.72 per litre and diesel ₹87.62 per litre.
Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum adjust ATF and LPG prices on the first day of every month. Their monthly revisions track movements in international fuel benchmarks and the rupee exchange rate. While oil prices have softened recently, seasonal demand for LPG in winter has firmed up global liquefied petroleum gas markets, contributing to the local commercial price rise.
Market participants will watch whether the ATF reduction feeds through to ticket pricing or capacity plans over the coming weeks. For hospitality and foodservice operators, the commercial LPG increase will add to input cost pressures, compounding a sector that has been adjusting to fluctuating fuel and labour costs.
The adjustments underline the sensitivity of domestic prices to global commodity movements and local taxation. Consumers, airlines and businesses will reassess budgets as these monthly revisions continue to reflect international trends and exchange‑rate shifts.
Key Takeaways:
- India ATF price cut reduces jet fuel costs across major cities, easing pressure on airlines.
- ATF in Delhi falls by ₹7,353.75 per kilolitre to ₹92,323.02; Mumbai, Chennai and Kolkata see similar reductions.
- Commercial LPG for hotels and restaurants rises by ₹111 to ₹1,691.50 per 19‑kg cylinder in Delhi while household LPG remains unchanged.
- State oil marketing companies link monthly revisions to international benchmarks and exchange rates.
