The worst of the disruption triggered by the US-Iran war may be over for the travel industry, but few in aviation or hospitality are ready to declare the crisis behind them. Fresh data from travel technology giant Amadeus suggests bookings have started to recover after months of cancellations, suspended routes and weakened demand across the Middle East. The improvement comes after one of the region's most turbulent periods for tourism in recent years, when airlines scrambled to reroute aircraft, governments briefly closed airspace and travellers abandoned plans almost overnight.

Speaking after the company's latest results, Amadeus CEO Luis Maroto said there were clear indications that demand had begun to stabilise."Our feeling is that the worst has happened already with all these cancellations, adjustments of routes, adjustment of capacity of the airlines," Maroto told analysts, adding that bookings had progressively improved since June.

His comments mark one of the strongest signals yet that travel demand is beginning to return after a conflict that rattled one of the world's busiest aviation corridors.

A conflict that rippled through global travel

When the conflict escalated earlier this year, the immediate focus was on security. Within hours, the commercial consequences became just as apparent. Airspace closures across parts of the Gulf forced airlines to suspend flights, divert aircraft and redraw long-established routes linking Europe with Asia. Israel, Iran, Iraq, Qatar and the UAE all experienced periods of disruption, while international carriers avoided large sections of Middle Eastern airspace altogether.

The operational impact spread far beyond the region itself. Aircraft remained airborne longer, fuel consumption climbed, crew scheduling became more complicated and network reliability deteriorated. For airlines already operating with tight fleet availability, every diversion carried a financial cost.

Cirium reported that more than 19,000 scheduled flights into and out of the Middle East were cancelled during the initial phase of the conflict. Hundreds of thousands of passengers were forced to alter travel plans as airlines struggled to rebuild schedules. The disruption reinforced how central the Gulf has become to global aviation. Dubai, Doha and Abu Dhabi are no longer simply destinations; they are among the world's largest transfer hubs, connecting traffic between Asia, Europe, Africa and North America. Interruptions in one market quickly cascade through airline networks thousands of kilometres away.

Tourism's growth story suddenly stalled

For much of the past decade, Gulf governments have invested billions of dollars in transforming tourism into a pillar of economic diversification. Saudi Arabia accelerated its Vision 2030 tourism ambitions. The UAE continued expanding its hospitality pipeline, while Qatar sought to build on the legacy of the FIFA World Cup. Luxury resorts, convention centres, entertainment districts and aviation infrastructure all formed part of a long-term strategy to reduce dependence on hydrocarbons.

Vacation rental cancellations in the UAE more than doubled during the opening stages of the war, reflecting how quickly travellers reacted to security concerns. Much of the lost business came from international visitors who postponed or redirected trips rather than cancelling holidays altogether. Dubai alone lost tens of thousands of short-term accommodation bookings during the height of the crisis, while tourism revenues across the region fell sharply as airlines reduced capacity and travellers sought alternative destinations. Unlike previous regional shocks, the decline was driven less by damaged infrastructure than by uncertainty. Travellers tend to judge risk broadly rather than geographically. Conflict in one country often affects perceptions of an entire region.

Hotels felt the pressure almost immediately

Airlines were the first to absorb the operational shock, but hotel companies soon began reporting the financial consequences. Marriott International said revenue per available room (RevPAR) across the Middle East dropped 43%, making it one of the weakest-performing regions in the company's global portfolio. The slowdown weighed on wider Europe, Middle East and Africa results even as demand remained resilient elsewhere. The company pointed directly to the conflict as a key factor behind weaker regional performance.

That contrast has become one of the defining characteristics of this year's travel market. International travel demand has not disappeared. Consumers continue to spend on leisure experiences and premium travel. What has changed is destination choice. Travellers have become far more sensitive to operational disruption and geopolitical risk, particularly on long-haul journeys requiring multiple flight connections.

Airlines continue to pay the price

Even as bookings recover, airline economics remain under pressure. Many carriers continue operating longer flight paths to avoid sensitive airspace, increasing fuel burn and reducing aircraft utilisation. Schedules built around tightly timed connections have become more difficult to maintain, while crew costs have risen alongside operational complexity.

British Airways parent International Airlines Group has already acknowledged that geopolitical disruption is limiting planned capacity growth despite additional aircraft entering the fleet. Cathay Pacific temporarily suspended services to several Middle Eastern destinations, while other Asian and European carriers repeatedly adjusted schedules as security assessments evolved.

Those operational changes matter well beyond airline balance sheets. Reduced capacity means fewer visitors arriving at hotels, convention centres, cruise terminals and tourist attractions. Every cancelled long-haul flight removes hundreds of potential visitors from local economies.

Some destinations gained while others lost

Southern European destinations such as Spain and Portugal experienced stronger bookings as travellers looked for alternatives perceived to involve less geopolitical risk. Airlines and hotels in both countries benefited from demand diverted away from the Middle East during the conflict.

Cyprus, Greece and parts of the eastern Mediterranean initially experienced softer demand as travellers associated the wider region with instability despite being far removed from active military operations. As the security situation stabilised and airlines restored services, bookings gradually improved, particularly among repeat visitors familiar with the destinations. The episode once again demonstrated how perceptions can travel faster than aircraft.

Recovery is under way, but confidence will decide its pace

The latest comments from Amadeus offer the clearest indication yet that the industry's recovery has begun. Improving booking trends suggest travellers are gradually returning as airlines restore capacity and governments reopen airspace. Corporate travel has shown encouraging resilience, while premium leisure demand has recovered faster than the mass market.

Airlines continue to monitor security developments almost daily. Hotels are maintaining flexible booking policies to reassure international guests, and tourism boards across the Gulf have resumed marketing campaigns designed to rebuild confidence rather than simply stimulate demand. The region still possesses formidable strengths. Dubai, Doha and Abu Dhabi remain among the world's best-connected aviation hubs. Saudi Arabia continues investing heavily in tourism infrastructure, while international hotel groups have not slowed their long-term expansion plans.

The next phase will depend less on promotional spending than on operational stability. If airlines can maintain reliable schedules and geopolitical tensions remain contained, the recovery gathering pace since June could strengthen through the second half of the year. For now, the industry's mood is best summed up by Maroto's assessment. The immediate shock appears to have passed. The harder task now is rebuilding confidence—one booking at a time.