Thai hotels see Q4 recovery hopes after US-Iran deal calms oil and flight concerns
TUESDAY, JUNE 16, 2026
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Akarin Vibultangman
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Thai hotels expect travel sentiment to improve after the US-Iran deal, but operators warn recovery may not fully return until the Q4 high season
Thailand's hotel industry anticipates a recovery in foreign tourist arrivals during the fourth-quarter high season, driven by a planned US-Iran peace agreement.
The deal is expected to boost the rebound by restoring traveler confidence, easing pressure on fuel prices, and reopening crucial air routes through the Middle East.
Following months of disruption, approximately 70% of hotel operators now expect foreign tourist numbers in the fourth quarter to return to pre-conflict levels.
The reopening of the Strait of Hormuz is seen as a key factor that will help lower global oil prices and reduce concerns over air travel costs.
Thailand’s hotel industry is hoping the planned US-Iran peace agreement will help restore travel confidence, ease pressure on fuel prices and support a recovery in foreign tourist arrivals during the fourth-quarter high season.
The expected signing of the agreement on June 19, 2026, together with the reopening of the Strait of Hormuz, has lifted sentiment across the global tourism industry after more than three months of Middle East conflict, energy-price volatility and disruption to air travel.
Thienprasit Chaiyapatranun, president of the Thai Hotels Association (THA), said the prospect of a US-Iran peace agreement was immediately positive for travel psychology, although operators were still waiting for the formal signing.
He said the reopening of the Strait of Hormuz should help global oil prices ease and reduce concerns over air routes through Middle Eastern airspace.
“However, it is still difficult to assess how much oil prices will fall and how this will affect airfares,” he said. “We are not sure whether the high fuel costs seen earlier will create inertia for another year. But overall, the atmosphere will definitely improve. With no airspace closure, travel can return, and we hope to see flights that were previously cancelled resume so tourism can return to normal.”
High season seen as key recovery window
Thienprasit said foreign arrivals to Thailand in the third quarter of 2026 were still expected to be slightly lower than in the same period last year, mainly because of the impact of the Middle East conflict.
He said the 2026 FIFA World Cup, co-hosted by the United States, Canada and Mexico from June 11 to July 19, had not yet shown a clear impact on foreign tourist numbers.
The THA now expects average hotel occupancy in June to perform better than its earlier forecast of 50%, which was based on the May 2026 accommodation operator confidence survey.
Still, he warned that the market was unlikely to rebound immediately.
“The Middle East war lasted for more than three months and affected the global economy,” he said. “We expect the situation to improve in the fourth quarter, which is Thailand’s tourism high season.”
May occupancy falls as low season begins
The May 2026 accommodation operator confidence survey, conducted by the THA and the Bank of Thailand between May 13 and 31, covered 154 accommodation operators.
The survey found that average hotel occupancy in May stood at 56%, down from the previous month as Thailand entered the low season and as Middle East tensions continued to weigh on travel.
Central region: 64%, slightly up from 63% in April
South: 48%, down from 67% in April
Most hotel operators expect revenue in the third quarter of 2026 to decline from the same period last year, mainly because of fewer tourists.
However, around one in 10 hotels expect revenue to rise, partly because more Thai travellers are choosing domestic trips, especially to nearby provinces, to control travel costs after increases in fuel prices and airfares.
Costs remain a major concern
The survey found that more than half of hotel operators expect total costs over the next three months to rise compared with the period before the Middle East conflict.
Most expect costs to increase by 6-10%, led by:
fuel costs
raw materials
electricity bills
Liquidity remains tight for many operators, although most are still able to continue business. More than 52% said liquidity had become tighter but remained manageable, while 42% said their liquidity was still at an appropriate level for operations.
Thienprasit said around 70% of hotel operators expected foreign tourist numbers in the fourth quarter of 2026 to return close to the level seen before the Middle East conflict.
Hotels seek support on tourism, energy and finance
Hotel operators are also calling for government support to help the sector manage costs and prepare for recovery.
The measures most requested by operators include:
tourism and revenue stimulus, including domestic travel campaigns and joint promotions with airlines and other tourism businesses
proactive overseas marketing to attract foreign tourists, especially from Asia and high-spending markets
promotion of tourism in both main cities and secondary destinations
more government meetings and events to support domestic demand
lower fuel and energy costs, reduced state fees and tax relief
soft loans to support hotel renovation and investment in sustainable energy
easier access to training systems for service workers
continued communication on tourism conditions so businesses can plan in time
The outlook marks a shift from earlier concerns across Thailand’s hotel and MICE sectors, where high oil prices, reduced flights and weaker forward bookings had already weighed on low-season travel demand. Recent domestic fuel-price cuts may offer some relief, but hotel operators still see the full recovery path depending on lower travel costs, restored flight capacity and renewed confidence among foreign visitors.
