Vietnam braces for flight cuts from April after China, Thailand ban jet fuel exports

2026-03-16 - 05:54

VietJet Air and Vietnam Airlines face turbulence as aviation fuel supply disruptions hit services. (VietJet pic) HANOI: Vietnamese authorities have warned the country’s aviation industry to prepare for potential flight reductions from April after China and Thailand halted exports of jet fuel due to the Iran war, increasing the likelihood of shortages. Vietnam imports more than two-thirds of its jet fuel needs, with 60% coming from China and Thailand, according to documents from the aviation regulator and importers seen by Reuters. “There are risks of jet fuel shortages for Vietnamese airlines from the beginning of April and the following months,” the Civil Aviation Authority of Vietnam said in a March 9 document sent to the ministry in charge of transport. It said airlines should review their plans, especially for domestic routes, and instructed airport operators to prepare additional parking space for Vietnamese carriers “in case they have to cut down on operations due to lack of aviation fuel.” Vietnam has also seen reduced supplies from Singapore, the document showed. In separate documents viewed by Reuters, major importers Petrolimex and Skypec said they could only guarantee jet fuel supplies for March, warning April contracts may not be fulfilled by suppliers. Skypec urged the regulator to restrict air transport to essential domestic routes if the conflict drags on. All documents were issued after China urged its refiners not to agree to new exports early this month but preceded a hard ban on refined fuel exports from March 11. Thailand banned exports of fuel oil on March 6 to all countries except Myanmar and Laos. The regulator, the ministry and the two importers did not respond to Reuters requests for comment. Vietnam’s top airlines Vietnam Airlines and VietJet declined to comment. Vietnam was the third-largest buyer of aviation kerosene from China last year after Australia and Japan, according to Chinese customs data. The Southeast Asian country has taken up the issue with both China, its main supplier, and Thailand. On Sunday, Foreign Minister Le Hoai Trung asked his Chinese counterpart Wang Yi for close coordination “to ensure energy security,” in a meeting in Hanoi that had been long planned, according to the Vietnamese government’s news portal. The topic of energy security was not mentioned in the Chinese readout of the meeting. On Friday, Prime Minister Pham Minh Chinh asked Thailand to help address the shortage during a meeting with the Thai ambassador in Vietnam, state media reported. The foreign ministries for Vietnam, China and Thailand did not immediately respond to requests for comment. Vietnam’s aviation authority noted in its document that “in the current context it is difficult to find new suppliers.” It added that Vietnam’s two refineries are under pressure to expand production of other oil products, making it hard for them to increase jet fuel output. Even if supply stabilises, soaring fuel prices are disrupting the industry, it also warned, noting many routes would become unprofitable. Local airline Sun PhuQuoc Airways plans to “adjust flight schedules over the next one to three months due to the volatility of fuel prices,” according to a document it sent to the aviation regulator in March. The company did not respond to a request for comment. Petrolimex and Skypec also flagged that the spike in jet fuel prices has meant they are quickly reaching limits on credit lines and urged banks to offer more flexible financing until market conditions normalise, the documents showed. Front-month jet fuel paper swaps in Singapore on a cost and freight basis are trading at around US$157 a barrel, more than one-and-a-half times higher than pre-conflict levels, LSEG pricing data shows.