Bali Starts to 'Bleed' from Iran War Effects, Number of Flights Drops Drastically
Bali Starts to ‘Bleed’ from Iran War Effects, Number of Flights Drops Drastically
Jakarta, CNBC Indonesia - Airspace chaos due to the conflict in the Middle East is beginning to impact the global aviation industry. Airlines are forced to avoid airspace around Iran and other sensitive regions.
As a result, flights must take longer routes, leading to increased fuel consumption, longer travel times, and higher operational costs. Thailand and Bali are the regions most affected.
Quoting Nation Thailand on Monday (23/3/2026), because much of the Middle East airspace remains tightly restricted, tens of thousands of flights have been cancelled or rerouted since the conflict erupted on 28 February. This situation disrupts the main Asia-Europe corridor and also affects the tourism sector in Southeast Asia.
Longer Routes, Increased Costs and Ticket Prices
Flight disruptions are now being felt directly by passengers. Reuters reports that airlines in Asia and Europe have raised fares, added fuel surcharges, and adjusted flight schedules.
This is triggered by the surge in jet fuel prices and route diversions that make travel times longer. Consequently, the risk of declining demand for long-haul travel, especially optional trips, is expected to rise in the coming months, particularly among price-sensitive tourists.
Thailand and Bali Face the Greatest Risks
Industry observers describe Thailand and Indonesia, particularly Bali, as the most vulnerable destinations in Southeast Asia if these disruptions continue.
Bali relies heavily on tourists from Europe and other long-haul markets. Thailand faces a similar situation, where longer travel times, reduced seat capacity, and higher ticket prices could suppress demand, especially during peak travel periods.
Malaysia Deemed More Resilient
Malaysia is seen as relatively more resistant to direct impacts, as European tourists account for less than 15% of total visits. Nevertheless, they generally stay longer and spend more on accommodation, tours, and shopping.
CNA reports that since the conflict began, at least 200 outbound flights, mainly to the Middle East, have been cancelled from Kuala Lumpur International Airport.
Although affected, industry players believe demand from East Asia, India, and Southeast Asia could offset the decline from the European market. Meanwhile, the Visit Malaysia 2026 programme and the ongoing trend of increasing tourism are expected to bolster Malaysia’s appeal.
Malaysia Sees Opportunities
Amid the disruptions, strategic opportunities are emerging. Malaysia’s Director General of Civil Aviation, Norazman Mahmud, stated that airports in Thailand, Singapore, Hong Kong, and Malaysia could position themselves as safer and more stable alternative transit hubs for passengers heading to Europe, as airlines reassess transit points in the Gulf region.
Malaysia Airlines is beginning to increase flight capacity to Europe. Malaysia Aviation Group has also announced additional flights to London and Paris to support travel needs during the disruption period.