Thousands of European tourists have cancelled their trips to Buleleng regency, North Bali, due to the volcanic eruption in Iceland that brought air traffic above Europe to a virtual standstill for almost a week.

Dewa Ketut Suardipa, chairman of the Buleleng chapter of the Hotels and Restaurants Association said the cancellations had badly affected occupancy rates at star hotels in the Lovina beach resort area, Pemuteran Beach and other tourist destinations in Buleleng regency.

Some hotels' occupancy rates dropped from 90 percent to 15 percent, Suardipa said. "Hotels with European markets really suffered heavy blows," he said.

Many hotels in Buleleng receive a large proportion of their guests from European destinations. Buleleng regency played a significant roles during the Dutch colonial period.

During that time, Singaraja was the island's largest port. Many European tourists come to the regency to visit the former Dutch landmarks.

Ayu Ardini, leisure manager of Puri Bagus at the Lovina Beach Resort Hotel, said the hotel's main market was European tourists.

"Our average occupancy rates are usually between 50 and 60 percent, but the Iceland's volcanic eruption has drastically dragged down our rates to only 15 percent in April,"  Ardani said.

However, many of the tourists who cancelled their trips have rescheduled to visit Lovina next year, he said.

Suardipa said he expected the cancellation to only temporarily effect tourism to the area. "Some hotels like Matahari Beach and Damai Hotel have almost 90 percent occupancy rates."

Non-star hotels have remained lucrative despite global travel problems. "We have numerous backpacking holiday makers staying at small hotels and villas in Lovina."

Suardipa said the political conflict in Thailand had not impacted tourism in Buleleng.

"Some tourists might have swapped their destination from Thailand to Bali, but we have felt no significant impact," he said.

Alit Kartarahardja, The Jakarta Post, Singaraja/North Bali