India’s aviation turbine fuel (ATF) consumption fell to 699,000 tonnes in July, a two-year low, driven by significant flight reductions from major carriers. The decline reflects a cooling in airline capacity and monsoon-related disruptions, impacting fuel demand after a period of rapid industry expansion.
Aviation turbine fuel (ATF) demand in India faced a notable slowdown in July 2026, dropping to 699,000 tonnes. This figure represents a 4% decline compared to June and a 1.5% fall year-on-year, marking the lowest level of consumption recorded since December 2023, according to provisional data from the Petroleum Planning & Analysis Cell (PPAC).
Impact of Capacity Reductions on Fuel Consumption
The decline in fuel usage is primarily attributed to a strategic scaling back of operations by major domestic airlines. According to aviation analytics firm Cirium, the number of scheduled domestic flights dropped by 8.6% to 82,437 in July, down from 90,198 in the same period last year. International flight schedules also contracted, falling by 6.7% to 35,366 flights.
Major players in the sector significantly tightened their flight networks. The Air India Group led these adjustments, with Air India reporting 11,386 domestic flights—a reduction of over 3,100 flights compared to the previous year—while Air India Express also saw notable cancellations. Low-cost leader IndiGo scheduled 1,611 fewer flights, while SpiceJet and Akasa Air reduced their operations by 918 and 262 flights, respectively. This consolidation of flight schedules directly correlates with the lower volume of fuel required by these fleets.
Operational Pressures and Future Outlook
Beyond intentional network rationalization, external factors played a role in the dampened demand. The arrival of the monsoon season caused widespread operational challenges, including flight delays, diversions, and cancellations at key airports. These disruptions, coupled with efforts by airlines to optimize fleet deployment, created a challenging month for aviation fuel volumes.
While the drop in consumption is significant, industry observers note that it follows a period of aggressive capacity expansion that spanned the previous two years. Investors and stakeholders are now looking to see if this reduction in flight schedules is a temporary response to weather and short-term network optimization or a sign of a more cautious approach to fleet deployment by Indian carriers. The primary monitorables in the coming months will be whether flight schedules recover as weather conditions stabilize and how airline profitability is impacted by changes in operating costs versus passenger load factors in this environment.