Middle East airlines slowly recover from Iran war as global air travel demand falls in June, says IATA

Dubai: Middle East airlines are slowly climbing out of the hole left by the Iran conflict, new figures from the International Air Transport Association (IATA) show, even as global air travel demand fell for a third straight month in June.

Traffic carried by Middle Eastern carriers dropped 13.9 per cent year-on-year in June, a sharp improvement on the 28.8 per cent collapse recorded in May, IATA said in its monthly passenger market analysis report.

Capacity in the region fell 11.3 per cent, and the load factor — a measure of how full planes is flying — slipped 2.3 percentage points to 76.1 per cent.

IATA said the smaller decline reflects both the gradual normalisation of airline operations across the region following the ceasefire in the Iran war, and a lower comparison base, since traffic in June 2025 was hit hard by the military strikes that month (the 12-day war).

On international routes specifically, Middle East carriers saw demand fall 14 per cent year-on-year, with capacity down 11 per cent and the load factor down 2.6 percentage points to 76.3 per cent.

Two key corridors showed the clearest signs of recovery. Traffic between the Middle East and Asia fell 11.6 per cent in June, easing sharply from a 25.6 per cent slump in May.

And on the Middle East-North America corridor, traffic was down just 1.9 per cent, a dramatic turnaround from the 28.3 per cent drop recorded the previous month. Within that corridor, traffic from North America to the UAE fell 3.8 per cent and to Qatar fell 13.5 per cent — both far smaller declines than the double-digit drops seen in May.

Global demand still in decline

Globally, air passenger demand fell 1.7 per cent in June compared with the same month last year, easing slightly from a 2.2 per cent drop in May. Capacity fell 1.3 per cent, and the global load factor dropped 0.4 percentage points to 84.2 per cent.

Strip out the Middle East, and the picture doesn’t improve much — global demand still fell 0.6 per cent, dragged down by weakness in Asia Pacific and North America.

IATA Director General Willie Walsh said the overall decline was "largely due to domestic market declines in China, the US, and Japan, and weak but improving international demand for Middle East carriers."

He added that renewed regional tensions "will not help the region's recovery," and warned that rising fuel prices would continue to push up airfares for travellers.

"People continue to travel, which is an important contributor to global economic growth," Walsh said, adding that stabilising the Middle East situation and normalising oil supplies "would improve prospects for airlines, economies, and societies the world over."

Mixed picture across the regions

European carriers posted the strongest growth among major regions, with demand up 0.8 per cent and international traffic climbing 1.5 per cent.

The Europe-Asia route was the fastest-growing major international corridor globally, up 11 per cent.

African airlines saw the biggest jump in demand, up 3.8 per cent, while Latin American and Caribbean carriers grew 1.5 per cent.

Asia-Pacific airlines saw demand fall 2 per cent, partly due to carriers cutting short-haul routes to reduce fuel costs, while North American demand slipped 1.1 per cent.