Tourism Economics warns Iran war could disrupt 116M visits worldwide

The conflict centred on Iran could have ripple effects well beyond the Middle East. 

Tourism Economics, a global travel forecasting firm and part of Oxford Economics, is warning that 116 million visits and 858 million nights outside the region could be at risk this year.

In a recent report, the firm said the impact on travel is expected to come through several channels, including weaker outbound demand from the Middle East, reduced transit through Gulf hubs, higher air fares linked to fuel and rerouting costs, and a broader shift toward regional travel.

“Almost 28mn outbound trips from the Middle East are at risk this year as ongoing air travel disruption and economic impacts take hold,” said director of global forecasting Helen McDermott and senior economist Jessie Smith. 

“Europe is especially exposed, accounting for 60 per cent of the lost trips, with Turkey, France and the UK particularly vulnerable as they typically take a higher share of Middle East visitors.”

The report also said another 28 million annual visitors who typically transit through the region are at risk, along with an additional 60 million travellers from the same source markets who may face higher costs as airlines reroute or reduce capacity. 

Tourism Economics said long-haul links between Europe, Asia-Pacific and Africa are already being affected by reduced flight capacity, airspace restrictions and longer journey times.

“Reduced flight capacity, rerouting and airspace constraints are already impacting long-haul connectivity between Europe, Asia-Pacific and Africa, resulting in increased journey times and air fares on flights between these regions," McDermott and Smith added.

Tourism Economics also said disruption in the Strait of Hormuz is adding pressure on jet fuel prices, which could further push up airline costs and fares. 

The report noted that some Asian airlines have already signalled flight reductions, while higher energy prices could also weigh on consumer spending and discretionary travel.

Looking ahead, the firm said travellers may increasingly favour closer-to-home options they see as safer and more affordable. 

It pointed to Southern European destinations such as Spain, Portugal, Greece and Italy as possible beneficiaries of substitution, while Egypt, Morocco and Tunisia could also gain as travellers look for alternatives offering similar cultural experiences.

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