Heathrow Airport has warned that its passenger numbers for the rest of 2026 are likely to be negatively impacted by the ongoing Iran war, according to their latest trading update. This forecast comes despite an increase in passenger traffic during the first three months of the year, with 18.9 million people passing through its terminals, marking a 3.7% year-on-year rise. The airport attributed this initial growth to "temporarily absorbed demand from elsewhere" as air travel shifted due to airspace closures in the Middle East following the war's outbreak on February 28.
The conflict significantly disrupted air travel, especially routes connecting Europe, Asia, and Australia, which typically see about 500,000 passengers daily through major hubs like Dubai, Doha, and Abu Dhabi. Although much of the Middle East's airspace has since reopened, many travelers continue to avoid the region, contributing to Heathrow's uncertain outlook. The airport's chief financial officer, Sally Ding, noted that while Heathrow had a solid start to 2026, the ongoing conflict creates an uncertain environment.
Financially, Heathrow reported a 2.3% increase in revenue to $844 million in the first quarter, driven by higher passenger numbers, increased food and beverage sales, and greater uptake of premium services. However, adjusted operating costs also rose by 6.5% due to increases in wages, national insurance payments, IT investments, and passenger support. The airport also highlighted that it is currently operating at full capacity and is ready to proceed with its plan for a third runway, contingent on the appropriate regulatory framework and government policy.
The broader implications of the conflict include a surge in jet fuel costs, partly due to the blockade of the Strait of Hormuz, a critical route for UK jet fuel imports. While the UK Department for Transport assures there are no immediate supply issues for the summer, contingency plans are in place, allowing airlines to consolidate flights and rebook passengers without forfeiting airport slots. This move is aimed at conserving fuel and maintaining service amidst the prevailing uncertainty.
