Air fares are likely to increase by 10-15% from current levels in the immediate future following a steep hike in jet fuel prices, according to travel industry players.
"Fare hike is imminent. The only question is who takes the lead. I would expect a 10-15% increase in fares in the coming days," said Travel Agents Federation of India (TAFI) immediate past president Ajay Prakash on Wednesday.
Prakash, who is the chief executive of Nomad Travels, said fares have already seen some traction in the last two days and "the trend is likely to continue."
Jet fuel (ATF) prices were hiked by a steep 6.9%, taking the rate to Rs 75,031 per kilolitre (KL) from September 1. This comes on the back of two rounds of ATF price hike effected in July and August.
ATF prices were increased by 5.8% on July 1 and by another 6.3% on August 1.
"With the steep hike in air turbine fuel prices, the airlines are left with no option but to jack up the fuel surcharge to offset the increase," Travel Agents Association of India President Iqbal Mulla said.
Expecting an increase of up to 10% in domestic fares, Mulla said the sharp decline in rupee value against US dollar and high jet fuel prices will have multiple effects on ticket rates.
Airlines Air India, Jet Airways, SpiceJet and IndiGo did not respondent to queries on the issue.