Gulf travel bookings approach pre-war levels

Waleed Mansour

Travel activity in the Gulf states is gradually regaining momentum, driven by improved demand for regional flights, the stabilization of airline networks, and rising travel rates for business and visiting friends and relatives (VFR). These indicators reflect the sector’s capacity to overcome a significant portion of the repercussions stemming from the conflict between the United States and Iran, which erupted last February.

A recent report published by Arabian Business noted that travel bookings in the Gulf Cooperation Council (GCC) countries are gradually approaching pre-war levels. This recovery coincides with the stabilization of regional air routes and the return of airline networks to operations closer to normal, following a period marked by widespread disruptions to flight schedules and passenger movement.

The report indicated that while the travel sector has not yet fully restored the activity levels recorded before the war, current indicators reveal a continuous improvement in demand, particularly for intra-regional flights. During this time, Gulf airlines have continued to enhance their operations, recovering an increasing share of passenger traffic week by week.

**Continuous Recovery**

Although passenger numbers remain below pre-war levels, the pace of recovery has become more evident in recent weeks, with travel activity recording consistent weekly growth. This trend strengthens expectations that the sector will witness further improvement in the coming period, provided political and security conditions stabilize.

It appears that the ongoing conflict between Washington and Tehran has not halted regional demand for travel. Residents of Gulf states continue to move between regional markets for business purposes, visiting relatives and friends, or short-term tourism. Furthermore, the recurrence of tensions after periods of de-escalation has not yet been sufficient to reverse the recovery trajectory that the sector began to record during the summer.

Strong regional demand stands out as one of the key factors supporting the Gulf travel sector. Passengers from within the region have helped offset part of the decline caused by the drop in tourists arriving from distant international markets. However, international tourism remains the weakest link in the recovery path, particularly as several foreign governments continue to issue travel advisories to their citizens regarding travel to the Middle East. These advisories influence travelers' decisions, especially those coming from European, Australian, and other major tourist-source markets.

**Strong Indicators**

Data released by Capital Economics showed that the Gulf travel sector experienced a strong recovery during the current summer, following the severe pressures it faced after the outbreak of the war and the subsequent changes in flight routes and the suspension of services by some international airlines.

The temporary peace agreement between the United States and Iran provided a strong boost to the sector at the beginning of the summer. The improvement in security conditions encouraged the recovery of deferred demand and allowed airline networks to operate with greater stability. However, the collapse of the agreement on July 8 reintroduced a degree of uncertainty into the markets, reflecting on travel decisions and the plans of some airlines.

The data reveals a clear disparity in the speed at which different passenger segments are returning. Business travel has recovered approximately 70% of the level it recorded before the war, a significant indicator of the return of commercial activity and the movement of businesspeople, including travel related to companies, conferences, and meetings in the region.

Conversely, recovery was stronger in travel for visiting family and friends, with activity in this category reaching about 85% of pre-war levels, making it one of the travel segments closest to restoring its normal activity.

**International Tourism**

The main obstacle to the Gulf travel sector fully returning to pre-war levels is the continued reluctance of a segment of international tourists to visit the Middle East, despite the stabilization of air traffic in an increasing number of Gulf destinations. Easing these advisories, should the security and political environment improve, could provide an additional boost to international bookings, especially as the region enters an important tourism season during the latter months of the year, when temperatures drop and Gulf destinations become more attractive to tourists from Europe, Asia, and other markets.

This implies that the fourth quarter may represent a critical phase for the sector, not only due to rising seasonal demand but also because it may witness the return of additional international air capacity lost by the region in recent months.

**Return of Carriers**

Uncertainty still surrounds the schedules of several international airlines, with some international carriers remaining absent from certain regional markets. However, the travel sector is showing growing optimism about the possibility of the return of some of these companies by the end of the fourth quarter. This could constitute a major turning point in the recovery path, given the role international carriers play in directly connecting Gulf countries with European, American, and Asian markets.

The return of these companies would allow for increased seat capacity, improved direct travel options, and higher levels of competition. It could also help rebuild the confidence of international tourists in the region and support business travel, which relies heavily on flight frequency and direct connectivity between global economic hubs and Gulf cities.

**Determining the Recovery Path**

Current indicators suggest that Gulf travel has already made significant progress toward restoring pre-war levels, with business travel reaching approximately 70% of its previous activity and travel for visiting friends and relatives rising to 85%. Regional demand continues to support passenger movement, offsetting part of the decline in outbound tourism.

The greatest challenge remains the restoration of international tourists and the return of foreign airlines to full capacity, making the fourth quarter a pivotal period for the Gulf travel sector. If stability in conditions coincides with the easing of travel advisories and the resumption of flights by international carriers, the sector may move closer to its previous levels, entering the end of the year with stronger momentum that paves the way for a full restoration of activity.