Thailand's Aviation Sector Set for Growth as Demand for Jet Fuel Surges

Bangkok Aviation Fuel Services Plc (BAFS) Projects Robust Expansion

In recent developments, Bangkok Aviation Fuel Services Plc (BAFS) has indicated that Thailand's aviation industry is poised for substantial growth. This anticipated growth is attributed to increasing travel and rising demand for jet fuel. The company, which provides refueling services at Suvarnabhumi and Don Mueang airports, is expected to benefit significantly from this upswing in aviation activity.

Surge in Air Travel and Jet Fuel Consumption

Following a period of stagnation during the pandemic, the aviation industry is experiencing a revival. BAFS, reflecting this trend, has projected an impressive 18% increase in year-on-year revenue, reaching 3.6 billion baht this year. A primary driver of this growth is the surge in air travel, which has led to heightened consumption of jet fuel.

According to the Department of Energy Business, jet fuel usage in Thailand saw a marked increase from January to June this year. During the first half of the year, a combination of peak tourist season, a visa-free scheme, and an uptick in flights during extended holidays contributed to a 17% rise in jet fuel consumption. This figure climbed to 15.7 million liters per day, up from 13.5 million liters per day.

BAFS anticipates a 16% increase in jet fuel sales year-on-year, projecting a total of 5 billion liters in 2024, compared to 4.3 billion liters last year.

Foreign Tourist Arrivals and Infrastructure Developments

The Bank of Thailand has reported a rise in foreign tourist arrivals, with the number reaching 3.1 million in July, up from 2.7 million the previous month. This increase was largely driven by visitors from Malaysia, China, Russia, and Europe. However, there was a noted decline in tourists from the Middle East and India.

Industry Implications

This anticipated growth in the aviation sector is expected to have several implications: