UAE airfares could stay high through much of 2026 as Middle East aviation faces longer disruption

Dubai: UAE airfares could remain elevated throughout 2026, with a new report warning that the disruption affecting Gulf airspace, airline capacity and fuel markets could take months to unwind.

Under a relatively positive resolution, global airfares could still be 5 to 10 per cent above pre-war expectations in 2026, while a prolonged crisis could push prices significantly higher, according to a new report by Tourise and Oxford Economics.

Dubai and Abu Dhabi sit at the centre of one of the world's most important aviation corridors. Around 14 per cent of global transit traffic passes through Gulf hub airports, while roughly one-fifth of Europe-Asia travel typically connects through the region, the report said.

That means disruption to Gulf airspace does not only affect passengers travelling between the UAE and neighbouring countries. It can also affect long-haul passengers using Dubai and other Gulf hubs to connect between Europe, Asia and other global markets, the study explained.

The report, titled 'Resilience in a World that Doesn’t Reset: Redesigning Tourism for an Era of Permanent Disruption - offers an analysis of 85 major crises over two decades, which shows a clear pattern.

In a world defined by continuous shocks, destinations that act before disruption hits recover up to 1.5 times faster than those that wait. 

“In a world that does not reset between crises, disruption is a constant feature of the global tourism landscape,” said Ahmed Al-Khateeb, Minister of Tourism of Saudi Arabia and Chairman of Tourise.

“The real test for destinations measures how they prepare for volatility, protect traveler confidence, and maintain continuity ahead of such events.”

Why fares stay high

The report says the impact of the Middle East crisis could continue even after the immediate security situation improves.

Airlines are facing higher fuel costs, longer flight paths and reduced capacity as they navigate airspace restrictions. The report also notes that the impact on ticket prices can take time to emerge because airlines hedge fuel purchases and many flights are booked months in advance.

So even if restrictions begin to ease, UAE passengers may not immediately see cheaper tickets.

The report's modelling puts global airfares 5-10 per cent above pre-war expectations in 2026 even under a positive resolution scenario. Under sustained disruption, the impact could be considerably greater.

Moreover, disruption of energy exports through the Strait of Hormuz has put upward pressure on oil and jet fuel prices. Jet fuel prices have risen more sharply than crude oil prices because of refining margins and concerns over storage and supply capacity, according to the report.

Gulf hubs exposed

The scale of the Gulf's role in international aviation makes the UAE particularly exposed to the crisis.

The report says Gulf hubs account for about 14 per cent of global transit traffic, with approximately 20 per cent of Europe-Asia travel typically connecting through the region.

When airspace restrictions force airlines to divert around affected areas, flights can take longer and consume more fuel.

For UAE-based airlines and passengers, that can mean higher operating costs, changes to schedules and fewer available seats on some routes.

The report says the crisis has already had a significant impact on Middle Eastern aviation. IATA data cited in the study shows international capacity to and from Middle Eastern countries was nearly 40 per cent lower in April compared with a year earlier, while passenger demand fell by almost 50 per cent.

War or ceasefire?

The report models three possible outcomes for the current Middle East crisis. If a ceasefire holds, global travel is expected to grow by around 6 per cent in 2026.

If hostilities resume, global travel growth could fall by around 1 per cent. Under sustained disruption, global travel could decline by about 3 per cent, with weakness extending into 2027.

For Gulf aviation, however, even a ceasefire would not mean an immediate return to normal.

The report says connectivity would recover progressively, with airspace restrictions and travel advisories gradually easing. But airline capacity would not necessarily return immediately, meaning some routes could remain limited while carriers rebuild their networks.

Long-term impact on Gulf hubs

One of the report's more significant warnings concerns the long-term impact on Gulf hub airports.

If airlines are forced to operate alternative routes for a prolonged period, they could begin redesigning their networks and permanently incorporate new long-haul routings.

That could put pressure on the competitive position of Gulf hubs if alternative networks become embedded after the crisis.

For Dubai, one of the world's major connecting hubs, this is an important distinction. The immediate question is how quickly flights return once restrictions ease. The longer-term question is whether airlines change their networks in ways that reduce their reliance on Gulf connections.

Flights cut

The scale of the disruption is already substantial.

The report cites Cirium Ascend data showing that Middle Eastern carriers operated around 50 per cent fewer flights year-on-year in March 2026, while forward bookings through major Gulf hubs for the second and third quarters fell by more than 40 per cent.

Globally, more than 12,000 flight cancellations were recorded in May, representing around two million seats. The report says the cuts included major reductions by Lufthansa, Turkish Airlines and Air China.

The report also suggests airlines are not simply cutting flights because of safety concerns. Some reductions were concentrated on lower-yield routes with weaker load factors, indicating that carriers are also responding to uncertainty and protecting profitability.

UAE travel changes

The effects could also change how people in the UAE travel.

The report says prolonged disruption could make travellers more price-sensitive, encourage more regional and domestic travel, lead to later bookings and increase the importance of value for money.

That could be particularly significant for the UAE, where residents have access to a large number of short-haul destinations as well as extensive long-haul connectivity.

The report also says flexibility, refundability and access to real-time information are becoming increasingly important to travellers when geopolitical uncertainty is high.

Recovery takes time

The study's broader finding is that tourism has become faster at recovering from individual shocks, with average recovery times falling from around 24 months in the early 2000s to 10-12 months today.

But the report warns that increasingly complex, multi-country crises could slow that progress.

Adam Sacks, president of Tourism Economics, said, "The lesson learned is that resilience can be built before disruption occurs, in the actions destinations take to prepare.”

For UAE travellers, that leaves a simple takeaway: even if the fighting stops, the impact on Gulf aviation may not stop immediately.

Higher fuel costs, altered flight paths, reduced capacity and changes to airline networks could continue to affect how much passengers pay and how they travel through the region.