Airlines and tourism businesses in Vietnam are introducing measures to cope with volatile fuel prices while attempting to maintain the country’s appeal as a destination.
Conflict in the Middle East shows no sign of easing, keeping Jet A-1 fuel prices high and unpredictable. This has driven a sharp increase in airfares, affecting travel demand, particularly ahead of the Hung Kings Festival and Reunification Day (April 30) holidays.
A survey on March 31 found far fewer promotional fares and reduced flight frequencies across both major and leisure routes. On the Hanoi to Ho Chi Minh City route, the lowest one way fare in April is about VND 2.5 million, typically at off peak hours, rising to VND 5 million during popular times. Hanoi to Nha Trang fares range from VND 3 million to VND 7 million.
Some travellers are cancelling plans. One Ho Chi Minh City resident said a family trip to Phu Quoc during the Reunification Day holiday would cost at least VND 4 million per person for return flights, or VND 16 million for four people. Accommodation for two nights would add about VND 20 million, excluding other expenses, prompting consideration of cheaper road trips instead.
Tour operators said package tour prices remain stable due to pre agreed contracts, but independent travellers are bearing the brunt of rising airfares.
Sun Group reported an increase in booking delays and cancellations across its resort network, as airlines cut or adjust routes and ticket prices climb. The company warned of a potential decline in both domestic and international visitors, especially with peak holiday periods and the summer season approaching.
Airlines argue that fare increases are unavoidable. Vietnam Airlines said fuel costs have tripled since the onset of the Middle East conflict, with Jet A-1 rising from about USD 85 to USD 190 per barrel. This could increase the carrier’s annual costs by up to VND 30 trillion (USD 1.2 billion), representing the largest shock since the Covid-19 pandemic.
Carriers are attempting to optimise costs while maintaining operations, and have proposed adjusting fare caps or introducing fuel surcharges in line with market conditions.
The Civil Aviation Authority of Vietnam said it is working with airlines to diversify fuel supply, secure forward purchase contracts and adjust flight operations accordingly.
Tourism businesses are focusing on bundled offerings combining accommodation, entertainment and dining to sustain demand, particularly among families and international visitors. Vinpearl said it is prioritising value packages rather than raising prices.
Industry representatives have called for government support, including temporary reductions in value added tax on accommodation, entertainment and tour services for up to six months.
There are also calls to prioritise nearby markets with lower travel costs, such as north east Asia and ASEAN countries. Vietravel noted that Asia is becoming the centre of global tourism flows, presenting an opportunity for Vietnam if policies and industry coordination are strengthened.
The Ministry of Finance is considering fee exemptions in aviation and maritime sectors to ease cost pressures. Proposed measures include waiving aircraft certification, licensing and airport concession fees.
If implemented, state revenue could fall by about VND 3.55 trillion over nine months. However, the policy is expected to help sustain operations and support recovery in the aviation and tourism sectors during a period of significant volatility.
