SINGAPORE – Airfares from the Asia-Pacific region to the West continue to be elevated by the persisting conflict in the Middle East that broke out on Feb 28, according to a new report.
However, the premium for flying directly from Asia-Pacific to the West, compared with routes with a stopover at a major airport in the Middle East, has returned to the level seen in 2025.
The ASEAN Airports Economic Impact Study analysed the top 100 routes connecting Asia-Pacific countries to the West, based on passenger traffic. The report was released on Oct 7 by the Airports Council International Asia-Pacific & Middle East, a trade association representing more than 600 airports.
In 2025, direct flights from Asia-Pacific to the West were 18% more expensive than flights with a stopover in the Middle East, according to the report.
Following the outbreak of the Iran war, direct airfares were around 30% more expensive in March and almost 50% more expensive in April.
But such direct flights became cheaper than routes with a stopover in the Middle East in May and June because airlines that stop over in the region raised their prices and reduced their number of flights through that market, said Stefano Baronci, director-general of the Airports Council International Asia-Pacific & Middle East.
Eleven major airports in the Middle East operated just 66% of their usual scheduled flights from March to August, according to the report.
But the operational capacity of these airports has returned to more than 80% in August alone.
Baronci also said the premium for flying directly from Asia-Pacific to the Middle East has since returned to the 2025 average.
However, in terms of actual pricing, he said: “Both direct flights bypassing the Middle East and flights via the Middle East continue to be higher than what they were in 2025, and this will continue to be the case.”
He said the report had forecast a normalisation of airfares from Asia-Pacific to the West from September 2026 based on an assumption that Middle East airports would increase their capacity.
But this “will probably be challenged by the reality”, he said.
Some carriers have recently halted their flights to the Middle East because of geopolitical tensions.
Earlier this month, Singapore Airlines and its budget arm Scoot extended their flight cancellations between Singapore and the Middle East until December. Hong Kong carrier Cathay Pacific has also suspended its flights to the Middle East until the end of January 2027.
The report also showed that Singapore’s Changi Airport contributed most to economic growth among airports in ASEAN in 2025.
The airport directly contributed US$7.9 billion (S$10.1 billion) to gross domestic product, far ahead of US$3.1 billion in contribution by all airports in Thailand and US$3 billion in Malaysia.
Meanwhile, Singapore’s aviation sector contributed US$22 billion to its economy, considering indicators like trade, investment and productivity, which was also the highest seen in ASEAN.
Taken together with its catalytic impact on tourism, the sector put US$47.8 billion towards the Republic’s GDP and supported 597,000 jobs last year.
That was the second-highest socioeconomic value seen in ASEAN. Thailand led the chart because of the high value generated by tourism supported by the aviation industry.
In terms of government revenue, aviation activity in Singapore generated US$3.1 billion in direct tax revenue in 2025, which was the highest of any ASEAN country.
In comparison, the aviation sector in Malaysia contributed US$1.5 billion to government revenue, and that in Thailand, US$1.3 billion.
Baronci said: “All the indicators show that Singapore is excelling, and this is demonstrated by the direct impact, where 42% of all direct aviation GDP across ASEAN is generated by Singapore.
“In Singapore, you have high-value sectors. In Singapore, you have a high capital investment. In Singapore, you have strong human capital. In Singapore, you have a pro-business infrastructure. All of these fundamentally concur to have a bigger (contribution) than in other regions.”
In all, the aviation industry supported 23.3 million jobs and contributed US$244 billion (S$311.9 billion) to GDP in ASEAN in 2025.
Annual air passenger traffic through ASEAN airports is expected to rise from 650 million in 2024 to 2.9 billion in 2056, the report said.
