The geopolitical volatility in the Middle East, along with the higher jet fuel costs, will have a major impact on the global air travel demand. As per the International Air Transport Association (IATA), while global air travel demand would continue its growth path in 2026, the trajectory will follow a much slower pace.
As per the IATA, the industry-wide revenue passenger kilometres (RPK), a key measure of passenger demand, will grow by 2.1% year-on-year in 2026. The forecast marks a notable moderation compared to the stronger growth recorded in recent years.
According to the association, geopolitical hostilities involving the United States, Iran and Israel have triggered an energy shock that is expected to push up oil and aviation fuel prices, increasing operating costs for airlines and affecting consumer spending worldwide.
“The sharp increase in oil prices and the even greater surge in fuel costs weigh on both our industry and the macroeconomic environment,” IATA stated further.
As per the global aviation body, while global economic growth could slow by around half a percentage point to 2.5% in 2026, inflation may rise to 5%, reducing household purchasing power and affecting travel demand.
Among the regions, the conflict-ridden Middle East is expected to witness the sharpest travel demand decline, with passenger traffic projected to contract by 11.4% in 2026. IATA attributed the downturn to factors like airspace restrictions, operational challenges and a significant loss of transfer traffic resulting from the Iran war.
“The impact is unsurprisingly the most severe in this region, which faces airspace limitations and other operational constraints, resulting in a significant loss of transfer traffic,” IATA noted.
Africa, on the other hand, is emerging as a new growth arena, with IATA’s forecast predicting the strongest passenger traffic growth at 10% in 2026. However, as per the association, the increase will come from a relatively low base compared to the other regions.
The Asia-Pacific region is expected to remain the largest contributor to global passenger growth, with traffic projected to rise by 5.1% and account for more than half of the overall increase in global demand.
“Europe’s passenger traffic is forecast to grow by 2.8%, supported partly by rerouted traffic from disrupted Middle Eastern long-haul routes,” IATA said, while noting a growing preference among European travellers for leisure travel and visits to the closed ones within closer destinations.
“Passenger traffic in Latin America is projected to increase by 5%, aided by relatively resilient regional economies. Meanwhile, growth in North America is expected to remain subdued at 0.8%, reflecting the maturity of the market and a slowing US economy, particularly in the domestic travel segment,” IATA stated further.
Despite the slowdown, IATA said the global aviation industry remains resilient, as it concluded, “Overall, we expect the 2026 passenger outlook to slow meaningfully but nevertheless remain positive. While growth is weaker and more uneven across regions, the industry continues to expand, highlighting its remarkable adaptability in the face of sudden and severe external shocks and passengers’ need to travel.”