Travel disruptions due to Middle East conflict

What happened: The conflict in the Middle East has led to travel disruptions, with Heathrow Airport expecting a 1.1% decline in passenger numbers to 83.6 million this year. In April, passenger numbers at Heathrow fell by 5% year-on-year, the biggest annual drop since March 2025. Airlines have cut 13,000 flights globally in May, with nearly two million seats removed, potentially affecting travel during the UK's half-term holidays.

Market impact: The travel and tourism sector is bearing the brunt, with Heathrow predicting a fall in profits due to reduced passenger numbers. Airlines are cancelling flights and rerouting others, while jet fuel prices soar. The Foreign Office has lifted travel advisories for some Middle Eastern countries, but warnings remain in place, impacting consumer confidence in travel.

What to watch next: On May 25, Heathrow will release its quarterly traffic figures, providing an update on the impact of the conflict on passenger numbers. On June 1, the International Air Transport Association (IATA) will release its May air traffic report, offering a global perspective on flight cancellations and demand trends. Additionally, any further developments in the Middle East conflict could drive changes in travel advisories and consumer behavior.