Soaring prices during the Iran war jeopardize travel to tourism-dependent countries in Asia

June 1, 2026 - 21:07

BANGKOK (AP) - As the summer travel season approaches, rising prices and logistical headaches linked to the ongoing conflict with Iran are putting serious pressure on Southeast Asian nations that rely heavily on tourism. Countries like Thailand, Vietnam, and Indonesia are now facing a sharp slowdown in visitor numbers just as they were hoping for a strong rebound.

The trouble starts with airfare. Airlines have been forced to reroute flights away from Iranian airspace, adding hours to travel times and burning more fuel. Jet fuel prices have jumped significantly, and carriers are passing those costs on to passengers. A round-trip ticket from Europe to Bangkok now costs hundreds of dollars more than it did just a few months ago. For budget-conscious travelers, that extra expense is enough to cancel a trip or choose a closer destination.

Beyond flights, the war has created a sense of instability across the region. Travel insurance premiums have gone up, and some policies now exclude coverage for disruptions tied to the conflict. Tour operators report a wave of cancellations from travelers who are worried about getting stuck or facing unexpected costs.

Thailand is feeling the impact most acutely. The country welcomed over 35 million visitors in 2024, but early forecasts for this summer show a drop of at least 15 percent. Hotels in popular spots like Phuket and Pattaya are seeing fewer bookings, and small businesses that depend on tourist spending are struggling. Street vendors, taxi drivers, and local guides are all reporting a sharp decline in income.

Governments in the region are scrambling to respond. Thailand has considered offering visa waivers and subsidizing domestic flights to attract visitors from China and India. Vietnam is launching promotional campaigns focused on safety and value. But these efforts may not be enough to offset the broader economic drag caused by the war.

The situation is a reminder of how fragile tourism-dependent economies can be. A conflict thousands of miles away is now reshaping travel plans and livelihoods across Southeast Asia, with no clear end in sight.