March 27, 2026 | 04:38 pm
TEMPO.CO, Jakarta - The Indonesian Hotel General Manager Association (IHGMA) in Bali stated that the Middle East war affected hotel occupancy rates during the 2026 Eid al-Fitr holiday. However, IHGMA Bali Chair Bagus Ngurah mentioned that the impact is not being felt evenly across the island.
"Hotels catering to Middle Eastern and certain European market segments have been directly affected, seeing a significant drop in occupancy, particularly in areas like Nusa Dua, Sanur, and Ubud," Bagus told Tempo on Thursday, March 26, 2026.
Conversely, hotels in districts favored by Australian, Asian, and domestic tourists have experienced a considerable surge in bookings throughout the Eid period.
Bagus explained that the overall growth in occupancy during this year's holiday season has been largely driven by the domestic market. According to data from IHGMA Bali members, the average occupancy rate during the Nyepi-Eid period reached 75 to 80 percent, marking an increase of approximately 10 to 12 percent compared to 2025.
Despite the current growth, the IHGMA in Bali remains concerned that a prolonged geopolitical crisis in the Middle East could force hotels to compete for the same limited markets, potentially triggering a price war. "In addition, there are concerns regarding the impact of rising global oil prices on domestic airfares," Bagus added.
To mitigate these risks, Bagus mentioned that hotels are currently employing several key strategies to bolster occupancy. The first involves shifting market focus toward relatively stable demographics, such as domestic, Asian, and Australian travelers, in response to the Iran-Israel hostilities. Secondly, establishments are optimizing digital distribution by ramping up promotions through online travel agencies.
The third strategy focuses on offering value-added deals rather than deep discounts. "Hotels are tending to maintain room prices by bundling in extra value, such as food and beverage packages, spa services, or other amenities, to stay competitive without significantly slashing rates," Bagus said.
Read: Capybaras Draw Crowds at Bali Zoo Amid 120% Surge in Visitors
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