Global air demand up 2.1% as Middle East traffic drops 60%

Global air passenger demand rose 2.1% year-on-year in March 2026, but growth was constrained by a sharp decline in Middle East traffic, according to data from the International Air Transport Association (IATA). 

 

Total seat capacity fell 1.7% year-on-year as airlines cut schedules in response to airspace restrictions following the outbreak of the Iran war on 28 February 2026, while global load factors rose to 83.6%.

 

International demand declined 0.6% year-on-year, marking the first drop since March 2021, when global travel was still recovering from pandemic-related disruption. The fall was driven by a 60.8% decrease in traffic among Middle East carriers following widespread airspace closures. Capacity on international routes dropped 6.2%, while load factors rose to 84.1% due to reduced supply.

 

Domestic markets offset some of the decline, with demand rising 6.5% year-on-year and capacity up 5.6%. Load factors reached 83.0%, supported by strong growth in China, Brazil, Australia and Japan, although domestic traffic in India fell 1.0%

 

Regional performance diverged. Asia-Pacific airlines recorded an 11.5% increase in demand, supported by the tail end of Lunar New Year travel from 17 February to 3 March 2026. European carriers grew 7.7%, with traffic between Europe and Asia rising 29.3% as airlines rerouted away from the region.

 

North American carriers reported 3.7% growth, while Latin America and Africa saw increases of 12.1% and 19.2% respectively. In contrast, Middle Eastern carriers recorded a 60.8% drop in demand and a 56.9% reduction in capacity, with load factors falling to 67.8%, reflecting the impact of prolonged airspace restrictions across the region.

 

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Willie Walsh, IATA’s Director General, said: “Demand for air travel continued to grow in March despite disruptions in the Middle East. The nearly 61% decline in international traffic by carriers in the Middle East did, however, restrain global growth to 2.1%. Outside of the Middle East demand grew by 8%.”

 

The data comes as airlines continue to respond to disruption across Middle East supply routes which has affected both airspace access and fuel logistics globally.

 

Jet fuel prices rose from around US$831 per tonne before the conflict to a peak of US$1,838 in early April 2026, before easing to approximately US$1,560, according to Bloomberg data. While supply continues, elevated prices are placing pressure on airline margins and route economics. EasyJet reported around US$25 million in additional fuel costs in March 2026.

 

Walsh also warned that rising fuel costs could begin to impact passenger behaviour, even as demand and forward bookings remain stable. “Everybody’s watching what’s happening with jet fuel, both supply and pricing,” he said. “While this has not impacted March traffic or forward bookings to date, it remains to be seen at what point high prices could start to shift passenger behaviour.”

 

Airlines are already adjusting operations in response to the disruptions. Cathay Pacific has suspended flights to Dubai and Riyadh until 30 June 2026, while cutting around 2% of its passenger capacity between May and June. British Airways has also outlined network changes, including reducing flights to Dubai, Doha and Tel Aviv to one daily service from 1 July, and cutting Riyadh frequencies from two daily flights to one from mid-May.

 

For more information, visit www.iata.org