IATA slashes 2026 air traffic growth forecast amid Middle East conflict
Dhaka: The International Air Transport Association (IATA) has sharply cut its 2026 global air passenger traffic growth forecast to 2.1%, citing the ongoing Middle East conflict as a key driver of surging fuel prices and broader economic headwinds.
The revised figure marks a steep drop from IATA's December forecast of 4.9% growth. Passenger demand is measured in revenue passenger kilometers (RPK), which combines the number of passengers carried with the distance traveled.
IATA warned that the spike in oil and aviation turbine fuel prices would strain airline finances while also eroding consumers' spending power. It projects global economic growth to slow to around 2.5% in 2026, down from 3.4% in 2025, with inflation potentially climbing to 5%.
The Middle East is expected to bear the brunt of the downturn, with regional passenger traffic forecast to contract 11.4%. Airspace restrictions, longer flight paths, and reduced operations at major Gulf hubs have led to the loss of significant transfer traffic.
The region accounts for roughly 9.5% of global passenger traffic but handles more than 40% of global connecting traffic — making disruptions there particularly consequential for long-haul travel between Asia, Europe, and Africa.
Asia-Pacific is projected to record 5.1% growth, accounting for more than half of the entire increase in global passenger demand. Africa is forecast to be the fastest-growing region at 10%, although from a comparatively small base, while European traffic is expected to rise 2.8%, as travelers increasingly favor shorter leisure trips.
The traffic slowdown coincides with one of the sharpest fuel-cost increases airlines have faced in recent years. IATA expects the industry's combined fuel bill to rise nearly 40% to USD 350 billion in 2026, up from USD 252 billion last year. Jet fuel is projected to average USD 152 per barrel — nearly 70% higher than in 2025.
As a result, the global airline industry's net profit is expected to nearly halve to USD 23 billion in 2026, compared to approximately USD 45 billion the previous year.
Profit per passenger is forecast to fall to USD 4.50 from USD 9.10, even as airlines raise fares and introduce additional ancillary charges to offset rising costs.
Despite the gloomy outlook, IATA sought to temper alarm. "While growth is weaker and more uneven across regions, the industry continues to expand," it said, noting that passenger demand had moderated rather than collapsed.
