Siem Reap Restaurant Industry Reels as Iran War Cuts Visitors 37.5%

SIEM REAP, Cambodia, June 1, 2026 — Siem Reap's restaurant and culinary tourism sector faces its most severe pressure since the COVID-19 pandemic, as the combined weight of a 37.5% visitor decline in the first four months of 2026 and soaring fuel costs linked to the Iran war pushes local food businesses toward a critical threshold, according to reporting by the Associated Press.

The city that serves as the gateway to Cambodia's centuries-old Angkor Wat temple complex and that has built a thriving street food and restaurant culture around its tourism economy is now operating in conditions that restaurant owners, transport workers and industry analysts describe as unsustainable heading into what should be the peak summer travel season.

Siem Reap Restaurants Feel the Weight of a 37.5% Visitor Drop

The number of recorded international and domestic visitors to Siem Reap fell 37.5% in the first four months of 2026 compared to the same period in 2025, according to the provincial tourism department. Sokha Sambo, owner of the popular Sambo Khmer & Thai Restaurant in Siem Reap, said the rising price of liquefied petroleum gas used for cooking has strained her budget, hindering her ability to dish out her signature green curries.

"I'm worried about gas and goods inflation. It makes the business less profitable and difficult to cover employees' salaries," said Sambo, who employs 14 staff members. "This has greatly affected all of us."

Liquefied petroleum gas the standard cooking fuel for most restaurants in Cambodia has risen sharply in price as the Iran war disrupted global oil and gas supply chains. The Strait of Hormuz, a critical conduit for regional energy imports, was essentially closed to commercial traffic after the United States and Israel launched military operations against Iran more than three months ago, according to the AP report. Import-dependent economies across Southeast Asia felt the disruption immediately.

Iran War Drives Up Airfares and Cuts Arrivals Across Southeast Asia

The pressure on Siem Reap's restaurant trade sits within a broader regional crisis that has struck Cambodia, Thailand, Vietnam, the Philippines and other tourism-dependent economies in Southeast Asia simultaneously. Tourism in Thailand "is a big industry and we are feeling it," said Jitsai Santaputra of the Lantau Group in Bangkok. The number of visitors to Thailand fell 7% year-on-year in April, while European arrivals fell almost 16% and Middle Eastern arrivals sank 57%, according to Thailand's Ministry of Tourism and Sports.

Jet fuel shortages and rising costs have led Vietnam Airlines, the Malaysia-based AirAsia group, Hong Kong's Cathay Pacific and other carriers to cut flights or adjust schedules. Cathay Pacific's fuel surcharge for medium-haul flights jumped to $80, up from $34 before the war. For long-haul flights, it increased to $174, up from $73. Airspace closures over the Persian Gulf and disruption to Gulf airport layover routes forced commercial aircraft onto longer, more expensive flight paths, adding further upward pressure to ticket prices.

The combination of higher fares and growing travel uncertainty has suppressed bookings. Travelers are booking closer to their departure dates, indicating growing unease, said Lavinia Lau, Cathay Pacific's chief customer and commercial officer. Some prospective visitors have abandoned Asia travel plans entirely upon seeing airfare levels, with travel writer Sandra Awodele describing how planned Thailand holidays collapsed the moment she checked flight costs in March 2026.

Ground-Level Impact on Siem Reap Transport and Food Workers

The visitor decline has cascaded through every layer of Siem Reap's tourism-linked economy. Siv Pech, a 58-year-old tuk-tuk driver in Siem Reap, said he used to earn up to $20 a day toting tourists around the city. That income has plummeted to about $5 a day. His gas bill eats half of that. The rest goes to food. "Some days, I don't earn even a cent," he said.

For restaurant owners such as Sambo, the problem is bidirectional: fewer customers arriving in the city reduces table revenue, while the cost of running a kitchen rises simultaneously. Green curry one of Sambo's signature dishes and a staple of Khmer-Thai fusion cooking requires continuous gas use for cooking, making the LPG price spike a direct operational cost that cannot be easily absorbed or passed on to the reduced number of guests still arriving.

Economists Warn of Deeper Regional Impact

The economic knock-on effects of the Iran war's disruption to Asian tourism carry significance well beyond individual businesses. Tourism is vital for many regional economies, accounting for nearly 11% of economic activity in the Association of Southeast Asian Nations in 2019, according to the World Travel and Tourism Council. In Cambodia specifically, the sector underpins millions of jobs and represents a substantial share of foreign currency earnings.

An analysis by Moody's Analytics estimated effects from the war would probably reduce economic growth across the Asia-Pacific region by 0.1 to 0.4 percentage points in 2026. Albert Park, Chief Economist at the Asia Development Bank, said the conflict creates pressure through multiple channels: higher production costs, rising consumer prices and weaker external demand from both trade and tourism working simultaneously against regional growth.

Le Tuyet Lan, who operates bed-and-breakfast properties in Hanoi and Ho Chi Minh City, Vietnam, described how the crisis reshapes the hospitality market at every price point. Luxury travelers shift to mid-range options; mid-range travelers move toward budget accommodation; and the lowest-cost tier of the market loses customers who reduce travel entirely. Jitsai Santaputra of the Lantau Group summarized the industry's outlook bluntly: "This, happening within five years of each other, first the pandemic and now the war, is horrible for the tourism industry."

For Siem Reap's restaurants, the question heading into mid-2026 is whether the culinary tourism identity the city has built since Angkor Wat's international profile rose through the 2000s can sustain two back-to-back crises and remain intact for the eventual return of visitors. For owners like Sokha Sambo, that question has a 14-person payroll attached to it.

More information about Indian cuisine and its regional diversity can be explored through Indian cuisine history and traditions.

Businesses monitoring hospitality expansion trends can also explore restaurant industry growth trends for 2026 to understand how regional food concepts are shaping dining markets.