ACV Warns Domestic Airfares to Rise 15-20% on Jet Fuel Crisis

Overview

ACV (Airports Corporation of Vietnam) has reported that domestic airfares will rise 15-20% due to a severe Jet A1 fuel crisis caused by Middle East conflicts. Supply covers only about 20% of domestic demand, forcing airlines to cut capacity, restructure networks, and impose fuel surcharges. The crisis is expected to pressure airline margins and reduce passenger demand, especially in the leisure segment.

Key Facts

• ACV reports domestic airfares will increase by an average of 15-20% as airlines close low-price fare buckets.
• Jet A1 fuel supply in Vietnam meets only about 20% of demand, with the rest dependent on imports from China, Thailand, and South Korea.
• The physical fuel surcharge has peaked at $39.6 per barrel, a 20-fold increase, according to ACV.
• International airlines have reduced seat capacity in Q2 and Q3 2026 and are applying fuel surcharges of $20-$200 per ticket.
• Vietnam Airlines estimates additional fuel costs of 11,000-27,000 billion VND for the full year.
• Vietjet reports a monthly cost increase of approximately $24 million due to fuel prices at $195 per barrel.
• ACV’s 2025 revenue reached over 25,530 billion VND (+12% YoY), with pre-tax profit of 13,472 billion VND (+6% YoY).

What Happened

In its 2025 annual report, ACV highlighted that the aviation industry faces significant challenges from the Jet A1 fuel crisis. The Middle East conflict has disrupted supply chains, driving fuel prices to record levels. Domestic supply covers only about 20% of demand, forcing airlines to rely on imports from countries that are restricting exports, such as China, Thailand, and South Korea.

ACV noted that international carriers have shifted to defensive mode, reducing seat capacity in Q2 and Q3 2026, restructuring networks, and applying fuel surcharges of $20-$200 per ticket. Vietnamese airlines are prioritizing trunk routes (Hanoi, Da Nang, Ho Chi Minh City) and international flights, while consolidating domestic flights, optimizing load factors, and suspending night flights (0-5 AM). This has significantly reduced landing and takeoff slots at ACV’s 21 airports.

Market Context

ACV shares closed at VND 46,000 (+0.43%) on April 14, 2026, on HOSE. HVN (Vietnam Airlines) rose 2.24% to VND 23,000, and VJC (Vietjet) gained 5.82% to VND 176,000 on April 15. The fuel crisis adds to headwinds for the aviation sector, which had been recovering post-pandemic. ACV’s 2025 results showed solid growth, but the fuel shock threatens to dampen passenger traffic and airline profitability in 2026.

Strategic Significance

The Jet A1 crisis underscores the vulnerability of Vietnam’s aviation sector to external supply shocks. For ACV, reduced flight operations directly impact aeronautical revenue, while airlines face margin compression from higher fuel costs. The crisis may accelerate structural changes, such as greater fuel hedging, fleet modernization, and route optimization. Long-term, the development of Long Thanh International Airport remains a key catalyst for ACV, but near-term earnings face headwinds from lower traffic volumes.

What to Watch

• ACV’s 2026 business plan and revenue/profit targets, to be presented at the upcoming AGM.
• Q2 2026 passenger traffic data at ACV’s airports, particularly domestic vs. international trends.
• Any government policy response, such as fuel subsidies or tax relief for airlines.
• Fuel price movements and the duration of the Middle East conflict.
• Airlines’ Q1 2026 earnings reports for detailed cost impact and guidance.