The Arab Air Carriers’ Organization (AACO) forecasts that passenger demand among its member airlines will fall 10.3% in 2026, with the group collectively operating at a loss. Presented at the organization’s annual meeting in Doha on 3 November, the outlook also projects a 4.7% reduction in capacity, an average passenger load factor of 77% and a 5.2% contraction in cargo traffic. It is conditional on large-scale US and Israeli attacks on Iran not resuming.
The projections are not final results and could worsen if further attacks and retaliation disrupt regional operations. Airlines are managing uncertainty through measures including airspace closures, diversions and carrying additional fuel.
Air Arabia chief executive Adel Ali sees scope for demand to recover quickly if stability returns. Qatar Airways, Emirates and Gulf Air were described as approaching pre-war production levels, although profitability remains lower. Royal Jordanian’s chief executive cited fuel costs and weak demand for travel to the region as continuing pressures.
Gulf Air is seeking additional long-haul aircraft; more than 70% of its passengers connect through Bahrain. Oman Air, meanwhile, has reduced connecting traffic through Muscat from more than half of its passengers to 20% as it changes its business model. AACO did not provide an amount for the projected aggregate loss.