The ongoing geopolitical turmoil in the Middle East, fueled by attacks from Israel and the US on Iran, along with retaliatory strikes by Iran, has led to severe disruptions in regional aviation. Affected countries, including Iran, Israel, Iraq, Qatar, Bahrain, Kuwait, and Syria, imposed airspace closures, halting a significant portion of flights. Partial airspace restrictions also impacted operations in the UAE and Saudi Arabia.

Aviation analytics firm Cirium reports that since February 28, more than 23,000 flights have been canceled out of the 36,000 originally scheduled to operate in and out of the region. This represents a staggering 50% of scheduled flights, resulting in a loss of approximately 4.4 million seats.

According to Fitch Ratings, the long-term impact of this disruption depends on how long the conflict persists. Fitch anticipates the crisis will last less than a month, which would mitigate the strain on airlines, airports, and tourism. However, a prolonged conflict could significantly affect businesses that are less diversified.

Flight Cancellations and Airport Congestion

Airports such as Dubai, Abu Dhabi, and Doha have experienced significant disruptions, with many flights rerouted or canceled as airlines adapt their schedules. Between February 28 and March 5, over 15,000 flights were canceled across seven major regional airports, affecting more than 1.5 million passengers.

Airlines operating within the region face considerable financial losses, particularly those with hubs in countries severely impacted by the airspace restrictions. These carriers are most exposed due to their reliance on regional airspace. Operations in the UAE and Qatar are particularly constrained.

Increased Costs for Airlines

Airlines are incurring higher operational costs due to the detour of aircraft around closed airspace. These extended flight times result in increased fuel consumption, as well as additional expenses for technical stops, crew overtime, hotel accommodations, and airport handling fees. Although airlines are required to offer some level of passenger compensation, it is expected to be minimal, as the disruptions stem from factors beyond their control, specifically geopolitical conflict.

The disruption has also led to tighter flight capacity, which could drive up ticket prices on affected routes, potentially offsetting some of the lost revenue. Additionally, oil prices remain a critical factor in cost dynamics, with many airlines hedging fuel costs to cover a significant portion of their needs over the coming months.

Tourism Impact on GCC Region

Tourism to the Gulf Cooperation Council (GCC) region is expected to take a significant hit due to the ongoing conflict. Oxford Economics estimates that international arrivals could fall by as much as 27% in 2026, depending on the duration of the conflict. This could result in 23 million to 38 million fewer visitors, translating to a loss of $34 billion to $56 billion in tourism spending.

The UAE and Saudi Arabia, both major players in the region's tourism sector, are particularly vulnerable due to their heavy reliance on air travel and large markets. Israel and Iran are expected to experience the sharpest declines in tourism, with Israel’s inbound arrivals potentially falling by 57% and Iran’s by 49%.

Wider Economic Impact

Beyond the airlines, the disruption is expected to affect various sectors, including airports, hotels, insurers, and aircraft lessors. European airports, particularly those with significant Europe-Asia traffic, may face losses in revenue and retail spending. However, some of these airports may offset the decline through income from parking or regulatory protections tied to traffic fluctuations.

Hotels with exposure to the Middle East, mostly managed by global hotel groups with diversified portfolios, are better positioned to absorb the disruption. Aircraft lessors, whose fleets are globally diversified, are expected to experience limited financial impact, as their lease revenues are secured by long-term contracts.

Recovery Outlook

While the current disruptions are severe, aviation analysts suggest that travel patterns typically recover once airspace restrictions are lifted. Middle Eastern airports, strategically located between Europe, Asia, and other long-haul markets, are well-positioned to regain their role as key global hubs once stability is restored in the region.

Source: gulfnews

Riyadh Air and Saudia have announced the implementation of the first phase of their Strategic Cooperation Agreement, marking a major step in strengthening connectivity under Saudi Arabia’s National Aviation Strategy.

The partnership builds on a Memorandum of Understanding signed in November 2023 and enables the two airlines to expand travel options for domestic and international passengers.

As part of the first phase, Riyadh Air has established a connection with Saudia’s Passenger Service System (PSS), allowing the carriers to implement their codeshare across their respective technology platforms.

Under the RX-SV codeshare, Riyadh Air will place its “RX” designator on selected Saudia-operated flights from Riyadh’s King Khalid International Airport to six domestic destinations: Abha, Al Qassim, Dammam, Jeddah, Medina and Tabuk.

The agreement will give Riyadh Air passengers access to additional destinations worldwide through convenient connections in Riyadh. For example, travelers from Dammam can connect via Riyadh to Madrid on a single ticket, while passengers flying from Kuala Lumpur can connect through Riyadh to Medina.

By using Saudia’s frequent services between Riyadh and the six codeshare destinations, Riyadh Air will offer passengers more convenient connections aligned with the arrival and departure schedules of its flights at Riyadh.

Both airlines operate within the King Khalid International Airport Terminal 1-4 complex, enabling passengers to benefit from streamlined connections, single-ticket journeys and through-checked baggage to their final destinations.

The first phase represents a significant step toward deeper cooperation between Saudi Arabia’s two national carriers and supports the Kingdom’s broader ambitions to expand its global aviation network.

Source: aaco.org

SalamAir has announced the establishment of Salalah’s first-ever airline base, marking a major step in the airline’s expansion and strengthening direct international connectivity from Oman’s Dhofar Governorate.

The new Salalah-based operation will initially serve three international destinations: Jeddah in Saudi Arabia, Chattogram in Bangladesh and Calicut in India. Bookings opened on August 26, with flights scheduled to begin from the end of October as part of SalamAir’s Winter 2026 schedule.

The base follows SalamAir’s expanded operations during the 2026 Khareef season, when the airline increased capacity on the Muscat-Salalah route to as many as 15 daily flights during peak periods.

The airline also introduced special domestic fares for Omani nationals, with one-way tickets starting from OMR 9.99, supporting affordable travel between Muscat and Salalah.

The new base is expected to extend SalamAir’s role beyond the Khareef season by supporting year-round travel demand among residents and expatriate communities in Dhofar while offering more direct access to key regional and international destinations.

Operations from Salalah will be supported by SalamAir’s Airbus A320neo and A321neo fleet. The airline currently operates 18 aircraft, providing additional flexibility to support growing demand across its network.

During the winter season, SalamAir will also operate charter flights linking Salalah with Astana and Almaty in Kazakhstan, supporting inbound tourism from Central Asia.

The Salalah base forms part of SalamAir’s wider strategy to expand its network from key airports across Oman, develop underserved markets and stimulate new travel demand while supporting the growth of the Sultanate’s aviation and tourism sectors.

Source: ZAWYA