Travel sector stocks plummet, passengers worldwide stranded due to airline conflicts, oil prices reach months-long high. Added cancellation data in paragraph 3, updated stock prices in paragraphs 7 and 8. By Joanna Plucinska, Samuel Indyk, and Julie Zhu.
Travel sector stocks dropped Monday, losing $22.6 billion as the conflict between the United States, Israel, and Iran disrupted flights globally, closing major Middle Eastern hubs and skyrocketing oil prices, with analysts warning of weeks of disruptions.
The United Nations’ International Civil Aviation Organization told countries they “are responsible for ensuring the safety and security of aviation operations, facilities, and passengers.”
Gulf’s key platforms, including the world’s busiest airport, Dubai, saw over 1,000 flights/day, remain closed for the third day, leaving tens of thousands of passengers stranded amidst aviation’s biggest challenge since COVID-19.
Jordan became the region’s latest country to partially close its airspace on Monday.
U.S. State Department advised Americans to immediately leave over a dozen Middle Eastern countries, including Saudi Arabia and the UAE.
Oil prices surged up to 13%, hitting their highest level since January 2025, as Iran and Israel ramped up attacks, hinting at fuel cost increase for airlines.
The war caused American airline stocks to drop on Monday, with Delta Air Lines, United Airlines, and American Airlines falling by 2 to 4%. A group of 29 major airlines, hotels, and travel companies in Europe, Asia, and North America lost $22.6 billion in market value on Monday, as per Reuters calculations.
TUI, Europe’s largest tour operator, saw a 9.9% drop in shares, while German Lufthansa declined by 5.2% and British Airways’ owner, IAG, lost 5.5%.
“All airlines are full and all flights are full because people have to take what they can,” said Paul Charles, director of travel consultancy PC Agency, who himself was stranded abroad.
Travel technology company Navan said thousands of employees from hundreds of companies had to travel to or from the Middle East this week, while Marriott stated its hotels in the region remained open.
Analysts highlighted rising fuel costs, cancellations, and rerouting fees as pressure points for airlines despite hedging operations. JPMorgan, Goodbody, and Citi identified Wizz Air as the most exposed European carrier due to its strong presence in Israel.
American airlines operate very few flights to the Middle East, with Jefferies analysts estimating the region accounts for less than 1% of planned first-quarter capacity for American, United, and Delta.
Jefferies analysts warned that fuel cost increases could cut Delta and United’s profits by 5 to 10% in 2026, while American Airlines’ profits could drop by around 35%.
LIMITED FLIGHTS
A limited number of Etihad Airways flights from Abu Dhabi resumed on Monday, while Tel Aviv’s Ben Gurion airport announced its reopening on a limited basis.
UAE’s civil aviation authority will start operating “special flights” to help some of the tens of thousands of stranded passengers leave the region, as many Middle Eastern carriers continued to cancel or suspend flights.
Even before the conflict, the sector was under strain, with budget-conscious travelers avoiding expensive vacations. Norwegian Cruise Line Holdings predicted lower than expected profits for 2026.
Asian airline stocks were also impacted, with airlines like Singapore Airlines, Cathay Pacific Airways, Qantas Airways, and Japan Airlines all closing down by at least 4% on Monday.
Cathay Pacific canceled all flights to the Middle East, including Dubai and Riyadh, and waived rebooking fees.
Singapore Airlines canceled flights to and from Dubai until March 7, while Japan Airlines suspended Tokyo-Doha flights.
Singapore-based aviation analyst Brendan Sobie noted that Indian carriers were particularly exposed due to their heavy schedules to the Middle East, where they serve migrant workers, and the ban on using Pakistani airspace for flights to and from Europe.
RAPID FLIGHT CHANGES
Travelers worldwide felt the ripple effects. Dubai ranked as the world’s busiest airport in 2024, with 92 million passengers, surpassing London’s Heathrow by 13 million passengers. Doha ranked 10th.
Lufthansa canceled passenger flights to and from the UAE, while Qatar Airways passengers to Sydney told Reuters they were scrambling to rearrange their journey due to lack of information.
Italian travelers Ascanio Giorgetti, 16, and his mother Alessandra Giorgetti, had their Milan-bound flight via Doha canceled. They found an alternate route home via Los Angeles on a different airline. “We have no information, no answer on the phone from Qatar (Airways),” she said, noting the tickets cost 4,000 euros ($4,708).
78-year-old couple Jenni and Doug Stewart, flying from Sydney to Scotland via Doha, had their flight diverted back to Melbourne before heading back to Sydney. “We were told airspace had been closed,” Jenni explained. “It was chaos in Melbourne, hundreds of people looking for any information,” added Doug. (1 dollar = 0.8495 euros)
