Middle East's 2021 air passenger traffic to rebound 43% after slump: IATA

Dubai — The Middle East region's air passenger traffic will rebound 43% in 2021 if travel restrictions are not tightened further and more borders are not closed, an official from the International Air Transport Association said Feb. 4.

The Middle East recovery will be below the global forecast of a 50.4% improvement in 2021, Muhammad Albakri, IATA's regional vice-president for Africa and the Middle East, said in a media briefing Feb. 4.

However, if more countries around the world react to the spread of the virus and its variants by enforcing more travel restrictions, closing borders and resorting to harsher quarantines, the global recovery will fall to 13% above 2020 levels, according to IATA.

"We lost all those (safe travel) corridors (in the Middle East) that really started to give hope to industry recovery and if countries continue to act in the same manner of closing borders, [and] imposing harsh measures, we will be back to the worst case scenario," Albakri said.

IATA doesn't have a statistic for worst case scenario for the region, but 24 countries in Africa and the Middle East currently have quarantine and testing measures.

The potential recovery in 2021 passenger traffic could help boost jet fuel demand.

S&P Global Platts Analytics expects the region's jet fuel consumption to rise about 24% to 400,000 b/d in 2021 – still 34% lower than pre-pandemic levels of 2019, with many travelers unable or unwilling to fly.

2020 plunge

Last year, the Middle East performance was much worse than other regions.

The region's international passenger traffic plunged 72.9% in 2020, while passenger capacity plummeted 63.9%, Albakri said.

The regional airlines' load factor dropped 18.9 percentage points to 57.3%, the lowest among all regions.

Last year's regional December demand was down 82.6% compared with 2019 December levels.

The Middle East region's weakness last year is mostly due to its heavy reliance on international and transit travel, which was impacted by border closures and quarantines, Albakri said.

Oil prices impact

The recent uptick in oil prices is unlikely to impact the airline business because most carriers have grounded the majority of their fleets, he said.

"I do not think oil prices are going to be a determining factor in the recovery of the sector," Albakri said. "What is going to be a determining factor is governments opening borders, adopting testing, removing quarantines and allowing airline operators to re-establish their networks and re-establish their schedules."

However, the end of the Arab air blockade on Qatar is good news to the regional aviation industry and will help reduce costs for carriers that flew to and from Doha.

The UAE, Egypt, Bahrain and Saudi Arabia in January lifted an air blockade that had been in place since mid-2017.