A conflict-driven closure of the Strait of Hormuz has sent jet fuel prices in Asia & Oceania to USD 208.79 per barrel as of 27 March 2026 — more than double the USD 90 per barrel global average recorded in early 2026 — triggering earnings downgrades, capacity cuts, and price increases across Southeast Asia’s aviation, tourism, medical travel, gaming, and manufacturing sectors. Airlines including AirAsia X, Singapore Airlines, and Thai Airways have responded with fare hikes and route cuts, while Jollibee Foods reported a 39% profit drop and Bangkok Dusit Medical Services warned that Middle Eastern patient volumes are falling sharply.
The damage is uneven: Indonesia and Malaysia are partly cushioned by commodity revenues, while the Philippines and Thailand face the sharpest exposure. Analytics firm Kpler estimates the Hormuz closure has removed nearly 21% of global seaborne jet fuel transport routes from the market — a physical supply crunch, not merely a price event.
Southeast Asia’s post-COVID travel recovery has run headlong into the worst jet fuel shock in the region’s modern aviation history. What began as a geopolitical disruption centred on the Strait of Hormuz has, over roughly three months, systematically dismantled the cost assumptions underpinning the region’s two most reliable foreign-exchange engines: tourism and medical travel.
The buried story here is not simply rising prices. It is that Southeast Asia’s competitive advantage in attracting long-haul visitors — built on affordable access and low operating costs — is being eroded in real time, precisely as the region was counting on a full demand recovery to restore post-pandemic balance sheets.
By 27 March 2026, the crack spread between crude oil and jet fuel had ballooned from USD 24.48 per barrel on 20 February to USD 86.22 on 20 March, settling slightly at USD 81.44 — still more than three times the February level. For airlines operating out of Manila and Bangkok, that translates directly into operating losses on routes that were marginally profitable even before the disruption.
Compounding the price shock, regional refineries in Southeast Asia have reduced throughput by roughly one quarter to two fifths in response to crude shortages, tightening jet fuel availability precisely when carriers need supply certainty most. Thailand and China have both halted exports of some fuel products, including aviation fuel, to protect domestic supply.
How the Hormuz closure is hitting Southeast Asia’s most exposed sectors
The damage is running through five distinct sectors simultaneously, and the earnings picture is deteriorating faster than governments anticipated when the disruption began.
In aviation, AirAsia X, Singapore Airlines, and Thai Airways have all implemented fuel surcharges and route cuts. AirAsia CEO Tony Fernandes has described the jet fuel crisis as worse than COVID-19 for carriers, with Thai AirAsia X already suspending its Bangkok-Shanghai and Bangkok-Riyadh routes through 30 June 2026. Vietnam Airlines activated contingency plans to maintain operations, while some Vietnamese domestic carriers have cut capacity by up to 30% on routes now running at a loss. Airports of Thailand has begun offering landing incentives and discounts to slow the traffic decline.
Aloysius Puranto, economist at the Economic Research Institute for ASEAN and East Asia (ERIA), identified the Philippines, Thailand, Malaysia, and Brunei as the most exposed economies, noting they import approximately 60% of their crude oil needs — leaving them with limited buffer against a sustained Hormuz disruption.
In consumer goods, the pressure is already showing in reported earnings. Jollibee Foods posted a 39% profit decline due to higher commodity and supply-chain costs and has placed expansion plans under review. Thailand’s Charoen Pokphand Foods warned that transport and raw material costs could continue rising as freight disruptions affect animal feed supplies. Malaysian condom manufacturer Karex Bhd. — which supplies Durex and Trojan — is raising prices by as much as 30% as the conflict disrupts supplies of oil-based chemicals, while glove producer Top Glove Corp. Bhd. has also increased prices amid nitrile material shortages.
The Economist Intelligence Unit projected in a March 2026 research note that global oil prices could average around USD 80 per barrel through 2026 under a stabilisation scenario, but warned that elevated prices would raise inflation and constrain growth across much of the region, with recession risk rising if disruptions persist. The Philippines has already recorded inflation at a three-year high, driven by its near-total dependence on imported fuel. Thai bank SCB X Pcl and the Philippines’ largest lender, BDO Unibank Inc, have both increased loan-loss provisions as lenders prepare for a rise in defaults tied to slower growth and weakening consumer demand.
Detailed data on the fuel price trajectory is available from the Asia Media Centre’s energy crisis analysis, which tracks the crack spread and regional demand figures through late March 2026.
| Metric | Figure | Date |
|---|---|---|
| Global average jet fuel price (early 2026 baseline) | USD 90/barrel | Jan–Feb 2026 |
| Global jet fuel price | USD 195.19/barrel | 27 March 2026 |
| Asia & Oceania jet fuel price | USD 208.79/barrel | 27 March 2026 |
| Crude-to-jet crack spread | USD 24.48/barrel | 20 February 2026 |
| Crude-to-jet crack spread | USD 86.22/barrel | 20 March 2026 |
| Seaborne jet fuel routes removed (Kpler estimate) | ~21% of global total | March 2026 |
| Southeast Asian refinery throughput reduction | ~25–40% | March 2026 |
Why the medical tourism and gaming sectors are now in the damage zone
The secondary effects arriving in healthcare and gaming are the part of this story that most earnings previews have not yet priced in. Bangkok Dusit Medical Services — Thailand’s largest private hospital group — has directly attributed a fall in patient volumes to the travel disruption, warning that higher living costs could also cause consumers to delay non-essential procedures. Thailand’s medical tourism sector, which had been recovering strongly through 2025, now faces a structural headwind that is fundamentally different from a demand slowdown: the patients willing to travel are being priced out of the air.
Genting Singapore flagged softer travel demand and weaker consumer sentiment as airfares and living costs rise — a warning sign for a casino sector that depends on high-frequency visitors from across Southeast Asia and, increasingly, from long-haul markets. The irony is not lost on anyone who has watched the region’s gaming expansion over the past decade: the same affordable aviation that made Singapore and Manila accessible to mass-market gamblers is now the sector’s most acute vulnerability.
Vietnam’s government has drawn on its fuel price stabilisation fund to cushion domestic consumers, but the fund is working against a backdrop of strategic reserves estimated at only around 50–60 days of supply — a thin buffer if the Hormuz disruption extends into the second half of 2026. Thailand has temporarily capped diesel prices and restricted fuel exports, including aviation fuel, to secure domestic supply, a policy that simultaneously protects consumers and constrains the fuel available to airlines operating from Thai airports.
Petrochemical companies are facing a separate but related squeeze. Thai energy major PTT Pcl has warned of higher financing and procurement costs tied to crude purchases and has secured additional supplies from outside conflict zones. Siam Cement has suspended part of its chemicals operations due to feedstock shortages. Michelin has stated that a prolonged conflict could add more than €400 million (approximately USD 465 million) in raw material, energy, and logistics expenses; Japan’s Sumitomo Rubber Industries, maker of Dunlop and Falken tires, has flagged rising input costs and begun implementing price increases in selected markets — relevant for freight transport and delivery networks across a region that serves as a major manufacturing hub for North American and European supply chains.
Beyond the headline
The bigger picture
This shock exposes how dependent Southeast Asia’s growth model remains on cheap imported energy and affordable air travel. Tourism, medical travel, and gaming have been treated as near-limitless engines of foreign exchange; the Hormuz disruption shows how quickly that engine can seize when fuel supply becomes both scarce and politicised. The region’s most tourism-dependent economies — Thailand and the Philippines — are discovering that their recovery strategy had an unhedged energy assumption embedded at its core.
The reach
Higher jet fuel costs and constrained capacity mean more expensive and less frequent flights into hubs like Bangkok, Manila, and Ho Chi Minh City, reshaping decisions on where to take long-haul holidays or base remote work operations. For Western expats in Bangkok and Manila, higher transport and electricity costs are already feeding into food and rent prices, eroding the traditional cost advantage. Exposure to Southeast Asian airline, airport, and casino stocks now hinges less on pent-up travel demand and more on how effectively each operator can hedge fuel and pass costs to visitors without killing volumes.
Our take
Southeast Asia’s tourism-heavy economies bet that demand would carry them through any post-COVID turbulence; the oil shock shows that strategy was complacent. The winners will be operators and jurisdictions that treat energy risk as core to their business model, not as a temporary externality. Investors and travellers should now distinguish between destinations with credible energy and transport resilience — Singapore and Malaysia have more tools at their disposal — and those still assuming cheap fuel is a structural feature of their competitive position.
What this means for Western travelers, investors, and companies with Southeast Asian exposure
With jet fuel in Asia & Oceania running at more than double its early-2026 baseline and refinery throughput reduced by up to two fifths, the disruption is now deep enough to affect decisions across travel planning, portfolio positioning, and supply-chain management.
- Monitor airfare and route availability actively: Carriers serving Bangkok, Manila, Ho Chi Minh City, and Singapore are adjusting schedules in real time. Check directly with airlines on fuel surcharge policies before booking long-haul travel into the region for the second half of 2026. Thai AirAsia X has already suspended selected routes through 30 June 2026; further suspensions are possible if jet fuel remains above USD 200 per barrel.
- Reassess Southeast Asian airline and airport stocks: Earnings guidance from major carriers and airport operators — including Airports of Thailand — is due between July and November 2026. Capacity cut disclosures and fuel hedging positions will be the key metrics to watch. The ERIA has identified the Philippines, Thailand, Malaysia, and Brunei as the most structurally exposed to sustained crude supply disruption.
- Medical tourism planning requires a longer lead time: Bangkok Dusit Medical Services has flagged reduced international patient volumes and warned of potential delays in non-essential procedures. Patients planning elective treatment in Thailand should confirm availability and factor in higher travel costs when comparing total procedure costs against home-country alternatives.
- Supply-chain exposure in tires, gloves, and petrochemicals: Western companies sourcing from Southeast Asian manufacturers — particularly in rubber, nitrile gloves, and petrochemical derivatives — face price increases of up to 30% from suppliers including Karex and Top Glove. Procurement teams should request updated cost schedules and assess alternative supplier options ahead of Q3 contract renewals.
- Track inflation data in the Philippines and Thailand: Philippine inflation is already at a three-year high. Regional CPI releases through mid-2026 will indicate whether energy-driven price pressures are peaking or broadening into core inflation — a key variable for the Bangko Sentral ng Pilipinas and the Bank of Thailand in their rate decisions. Both central bank websites publish monthly releases: bsp.gov.ph and bot.or.th.
