India aviation stays resilient despite soaring fuel prices and weak rupee

India's aviation sector showed continued resilience in June 2026 despite elevated fuel costs and a weaker rupee. Domestic passenger traffic reached about 13.5 million, a 1 % year‑on‑year decline but with a strong load factor of 85.7 %, up 118 basis points. International traffic rose 4 % month‑on‑month to roughly 2.4 million passengers, though it remained 15 % below the previous year and the international load factor fell to 76.1 %.

Global aviation fuel prices surged in July, with Brent crude up 20 % YoY and Singapore jet fuel up 71 % YoY, pushing operating expenses higher. The Indian rupee weakened to around ₹95.4 per dollar, adding pressure on aircraft leasing and maintenance costs. Brokerage Equirus warned that these cost pressures could affect airline profitability.

Market share shifted toward low‑cost carriers: IndiGo held 66.1 % of domestic passengers and 54 % of international traffic, while Air India Group's shares fell to 24.1 % domestically and 40.8 % internationally. Akasa Air also gained a modest presence. Overall, demand remained robust, but profitability faces headwinds from fuel and currency dynamics.