Airline shares rebound as ME flights resume, offering hope for hospitality

UAE – Airline shares has rebounded across Asian markets on Thursday as more flights took off from the Middle East, giving carriers some reprieve after stranding thousands of travelers when most regional airspace closed due to missile risks. 

Hong Kong’s Cathay Pacific Airways closed 2.2%, Qantas Airways rose 1% and Korean Air Lines jumped 5.6%, while Japan Airlines pared weekly losses to close just 1%. 

Major Chinese carriers including Air China, China Eastern and China Southern stabilized after falling between 1% and 4% in both Hong Kong and Shanghai trading. 

“Asian airlines are highly sensitive to Iran’s situation due to exposure through routes and energy in both revenue and costs. Any news on shortening the duration of the war can easily turn sentiment,” said Gary Ng, senior economist at Natixis. 

Ticket prices soared on popular routes such as Australia to Europe after Dubai’s closure, the world’s busiest international airport normally handling over 1,000 daily flights. Emirates and Etihad now operate limited services through UAE safe air corridors. 

On the other hand, Qatar Airways runs relief flights from Muscat to six European destinations including London, Berlin and Rome, plus Riyadh to Frankfurt. 

By Thursday morning, Emirates flights departed Dubai for Sydney, Hong Kong, Paris, Amsterdam, Toronto and Mumbai, though most services remain cancelled while Dubai airport take-offs and landings totaled 161 on Wednesday, nearly double the previous day’s count. 

The restrictions forced airlines to reroute flights, load extra fuel or make additional refueling stops to guard against sudden diversions on safer routes. These operational adjustments increase costs that ultimately pass through to travelers and hospitality partners. 

“For now, I consider this rebound to be primarily short-term in nature, and its sustainability will still depend on the ongoing situation in the Iranian conflict,” said Kenny Ng, securities strategist at China Everbright Securities International. 

As flights trickle back and stranded guests finally depart, hoteliers across the UAE watch anxiously for signs that international travelers will once again fill the rooms that have long made Gulf tourism a global powerhouse. 

Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.