Iran war impact: how global travel plans and tourist destinations are changing

Global travel patterns are undergoing a swift recalibration as the escalating conflict in the Middle East disrupts flight routes, dampens consumer confidence, and forces holidaymakers to rethink their plans.

Travel companies across Europe are reporting cancellations, weaker demand in affected regions, and a noticeable pivot toward alternative destinations, even as overall appetite for travel remains resilient.

Booking disruptions hit operators

British online travel agent Lastminute.com said on Thursday the conflict has affected around 17,000 bookings, reflecting the immediate impact of airspace closures and flight disruptions across key Gulf transit hubs.

The company, which offers packages to destinations such as Dubai and Abu Dhabi, said it is having to “adapt quickly” to shifting traveller preferences.

The escalation of the US-Israeli conflict with Iran at the end of February has led to restrictions on airspace across parts of the Middle East, including the United Arab Emirates, Saudi Arabia, and Qatar.

Lastminute.com said the affected bookings represent roughly a day and a half of its normal daily operations.

While cancellations have occurred, the company noted that many customers are choosing to amend rather than abandon their travel plans.

Despite the uncertainty, the company said “overall intent to travel remains high,” with customers increasingly prioritising flexibility and reassurance when making bookings.

Shares of Lastminute.com have fallen by 12% over the last month.

Shift towards safer destinations: Spain, Portugal in demand

The disruption has triggered a clear shift in destination preferences.

Lastminute.com reported rising demand for European alternatives, including the Canary and Balearic Islands in Spain, as well as Italian hotspots such as Sicily and Sardinia.

Industry-wide data suggests this trend is gaining momentum.

TUI Group, Europe’s largest holiday operator, said earlier this month that demand has increased for destinations such as Spain, Portugal, Greece, and Cape Verde.

“While we are seeing some cancellations in the affected areas, these are currently outweighed by customers choosing to amend their plans instead,” said Neil Swanson, a director at Tui, in a Guardian report.

Similarly, On the Beach reported a “significant slowdown” in demand for destinations including Turkey, Greece, Cyprus, and Egypt.

The company warned of a potential hit to profits and temporarily suspended its full-year guidance, citing uncertainty around the duration of the conflict and the pace of demand recovery.

Travel agents say the shift is also extending beyond Europe.

Jonathon Woodall-Johnston of Hays Travel noted strong demand for long-haul destinations, particularly in the Caribbean.

“We’re seeing particularly strong demand for our direct long-haul flying to the Caribbean, especially the Dominican Republic and Jamaica,” he said in the report.

Mark Duguid of Kuoni added that interest in Caribbean travel is “off the charts” in the near term.

Economic toll on West Asia tourism

The broader economic impact on the region is expected to be significant.

According to the World Travel & Tourism Council, West Asia’s tourism sector is losing an estimated $600 million per day in visitor spending.

The group also warned that the region could see between 23 million and 38 million fewer international visitors in 2026, translating into losses of $34 billion to $56 billion in tourism revenue.

These projections highlight the vulnerability of travel-dependent economies to geopolitical shocks, particularly when disruptions affect key transit corridors and global flight networks.

Domestic travel within India gets a fillip

While the conflict has weighed on international travel, it is also reshaping demand patterns in markets such as India, where domestic tourism is seeing a resurgence.

With fewer travellers willing to risk long-haul or transit-heavy journeys, destinations within India are witnessing a surge in bookings, a report by Firstpost said.

Hill stations in Himachal Pradesh and Uttarakhand, as well as regions such as Kashmir, Ladakh, and the northeast, are drawing increased interest.

Beach destinations, including Goa and the Andaman Islands, are also benefiting.

Data indicates strong growth in flight bookings to Indian leisure destinations, with Udaipur recording a 69% year-on-year increase, followed by Jodhpur, Bagdogra, and Srinagar.

Travel experts say the trend reflects a broader shift toward shorter, safer, and more flexible travel options.

Uncertainty abroad is encouraging travellers to rediscover domestic destinations, boosting demand for weekend getaways, nature tourism, and experiential travel.