The Civil Aviation Authority of Vietnam (CAAV) has asked the Ministry of Construction, which took over aviation oversight after a government restructuring in 2025, for a three-month surcharge mechanism on basic economy class domestic tickets from April 1 to June 30. The surcharge would sit on top of existing regulated fare caps, which currently limit what airlines can charge.
The proposal comes as Jet A1 aviation fuel prices have surged to crisis levels. The average price in March was $190-200 per barrel, but hit $234.34 per barrel on March 24, roughly double pre-conflict levels. The physical premium for jet fuel delivery has also climbed above $30 per barrel, reflecting the acute supply squeeze caused by disruptions to Middle East shipping routes.
Under the proposed plan, surcharges would be tiered by route distance and would fluctuate with fuel prices.
On the Hanoi-Da Nang corridor (500-850 km), the surcharge would be VND297,000 ($11) per ticket when Jet A1 is priced at $220 per barrel, rising to VND365,000 ($14) if fuel tops $250. That would push the maximum one-way fare from VND2.89 million ($110) to as high as VND3.255 million ($124).
For the busy Hanoi-Ho Chi Minh City trunk route (1,000-1,280 km), surcharges would range from VND450,000 ($17) to VND553,000 ($21), lifting the fare ceiling from VND3.4 million ($129) to nearly VND4 million ($152).
The steepest increase would hit the longest domestic routes. Flights over 1,280 km, such as Hanoi-Phu Quoc, would carry surcharges of VND553,000-680,000 ($21-26), pushing the maximum fare from VND4 million ($152) to VND4.68 million ($178), a 17% jump.
CAAV argued the proposed surcharges are still modest by regional standards. On Japan-South Korea routes of comparable flying time, fuel surcharges run at $55 per ticket when Jet A1 is at $180 per barrel, equivalent to about VND1.1 million ($42).
But higher fares are only part of the picture. Airlines are also cutting capacity.
From April, carriers plan to drop some domestic routes and reduce frequencies, prioritizing the Hanoi-Da Nang-Ho Chi Minh City and routes that serve essential political and economic functions. Some airlines have already suspended late-night, off-peak and low-demand services.
CAAV estimates that with Jet A1 prices at around $200 per barrel, airline operating costs jump by roughly 40%. A survey the authority conducted on March 20 of nearly 40 international and regional carriers found more than 60% had already raised or planned to raise fuel surcharges or fares from mid-March.
To ease the financial pressure on domestic airlines, CAAV has recommended extending the 0% import tariff on jet fuel, cutting the environmental protection tax on aviation fuel from VND1,500 to VND1,000 per liter, and reducing the value-added tax on jet fuel.
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