Middle Eastern Airlines Face 60% Demand Drop in March: What This Means for Aviation Investors and Business Owners
Muscat: Middle Eastern airlines experienced a significant 60.8% year-on-year decline in demand, primarily due to the ongoing US-Israel-Iran war, which led to the closure of much of the region’s airspace—except over the Sultanate of Oman and the western coast of Saudi Arabia.
According to the International Air Transport Association (IATA), capacity dropped by 56.9%, while the load factor stood at 67.8%.
Overall, total global demand, measured in revenue passenger kilometers (RPK), increased by 2.1% compared to March 2025. However, total capacity, measured in available seat kilometers (ASK), fell by 1.7% year-on-year. The global load factor improved to 83.6%, up 3.1 percentage points from March 2025.
International demand declined by 0.6% compared to the previous year, with capacity down 6.2% and a load factor of 84.1%. This overall drop in international traffic was largely driven by the sharp 60.8% decrease in demand from Middle Eastern carriers.
Willie Walsh, IATA’s Director General, commented, “Despite disruptions in the Middle East, air travel demand continued to grow in March. However, the nearly 61% fall in international traffic by Middle Eastern carriers restrained global growth to 2.1%. Outside the Middle East, demand actually grew by 8%.”
Walsh also highlighted concerns about jet fuel supply and pricing, stating, “In the coming months, regions heavily reliant on Gulf supplies, especially Asia and Europe, might face shortages. The high cost of jet fuel is increasingly reflected in ticket prices. Although March traffic and forward bookings were not affected, it remains to be seen when rising prices might impact passenger behavior. The summer travel season is currently shaping up to be busy, which is positive, but airline resilience is being tested. Stabilizing fuel supply and prices is crucial. Regulators should also consider granting airlines flexibility on slots given the extraordinary airspace restrictions and potential fuel rationing.”
Data from the National Center for Statistics and Information (NCSI) revealed that Muscat International Airport also saw a decline in international passenger traffic in 2026. Arrivals dropped from 1.18 million in January to 939,921 in February, and further down to 728,588 in March. Total passenger numbers for the first quarter of 2026 fell by 2.4% to 2.86 million, while monthly flight activity decreased to 5,515 flights in March.
Special Analysis by Omanet | Navigate Oman’s Market
The sharp decline in Middle Eastern air traffic due to regional conflict, contrasted with Oman’s relatively open airspace, positions Oman as a strategic aviation and logistics hub amid regional disruptions. However, the continued volatility in jet fuel supply and pricing poses significant operational risks, urging smart investors and entrepreneurs to prioritize fuel efficiency innovations and explore alternative transport services. Businesses should also advocate for regulatory flexibility to adapt swiftly to evolving airspace and fuel constraints, turning challenges into opportunities for resilient growth in the aviation sector.
