Thailand’s Airlines Raise Fares as Jet Fuel Costs Squeeze Regional Routes

Airlines in Thailand are raising prices on new bookings as jet fuel costs climb, while tickets sold in advance leave them exposed to the increase. AirAsia co-founder Tony Fernandes said the airline had sold seats when fuel cost about US$85 a barrel, before the price rose to about US$200 following the outbreak of the U.S.–Iran war on February 28, according to VnExpress, citing The Nation. He said fares on new bookings had risen by 20–25% or more.

Because passengers have already paid for advance bookings, airlines cannot recover the higher fuel cost on those seats. Thailand’s Civil Aviation Authority said fuel, normally 25–30% of airline operating costs, had risen to as much as 60% for low-cost carriers. It said domestic services were particularly exposed because Thailand’s tax structure makes their fuel more expensive than fuel used on international flights. The authority also reported tighter airline cash flow and more route suspensions.

Vietjet Thailand chief executive Woranate Laprabang said fares had risen 20–25% from levels before the Middle East war, according to VnExpress. He reported average domestic load factors—the share of seats filled—of 87–88% during the low season. Woranate said he did not expect a fare war in the fourth quarter of 2026, citing high fuel costs and aircraft availability that had not fully recovered from pandemic-era production cuts.

“With fuel prices this high, the revenue-management option for airlines is to raise fares. There will be no price competition in the fourth quarter, as ticket prices need to reflect higher costs.”Woranate Laprabang, Vietjet Thailand chief executive

Thai Airways International has taken a different measure against further price rises. Its chief executive, Chai Eamsiri, said the carrier had hedged 40–50% of the fuel it expected to use over the rest of 2026, according to VnExpress, citing Bangkok Biznews. Hedging fixes or limits exposure to future fuel prices for part of an airline’s planned purchases.

The pressure extends to neighbouring Vietnam, a market with 6.4 million scheduled seats compared with Thailand’s 6.6 million, according to aviation data provider OAG as cited by VnExpress. In March, Vietnam’s Civil Aviation Authority warned that fuel suppliers could guarantee supply only until mid-April 2026 and that airlines would need to adjust routes and capacity from April. That was an assessment made at the time, rather than a current supply forecast.