Two months after the war in the Middle East sparked a wave of trip cancellations reminiscent of the COVID lockdowns, Australian travellers and tour operators are beginning to adapt by pivoting toward destinations outside of Europe and the embattled region.
The outbreak of war in March punched a significant hole in tourism revenues as escalating tensions between Iran, Israel and the US left many travellers stranded or unable to depart. Tour operators now say the panic is subsiding as consumers seek out alternative itineraries but continue to travel.
“The first few weeks were really tough, it almost reminded us of COVID a bit,” said Brett Mitchell, the Australian head of Intrepid Tours. “A lot of cancellations and people calling for advice: ‘Do I go? Do I not go?’”
Slumps of 75 to 80 per cent in bookings in the first few weeks of the war were “pretty standard”, industry sources said, as travellers, tour operators and airlines grappled with the surprise closure of the Middle Eastern air corridor, thousands of flight cancellations and paralysing uncertainty.
The crisis raised questions about the future of holiday travel to the Middle East and Europe. But unlike the grounding of flights during the pandemic border closures, in March and April, as drones and missiles flew across the Persian Gulf, the local appetite for travel and tours remained strong.
Mitchell said that the “vast majority” of customers who cancelled tours wanted credits for future Intrepid tours, not refunds.
Today, there were a lot fewer cancellations for tours, he said, and customers were starting to come back and book. “We’re past those crisis days now, things are starting to stabilise,” Mitchell said. “People are still travelling, they are just changing where they want to go.”
The freeze on activity in the Middle East is reflected in the drop in tourist travel through the region.
Just last year, 2.8 million Australians travelled to the United Arab Emirates, while 1.78 million travelled to Qatar, primarily as stopover points to Europe. This month, 35 per cent of take-off and landing slots across the 30 Middle Eastern airports, including in Dubai, Abu Dhabi, and Saudi Arabia, have been cancelled, according to slot managing company Airport Coordination Limited.
Customers who might have booked for Europe and blanched at a Middle East transfer are instead looking to South-East Asia and Japan.
“We’re seeing a lot of the new bookings coming in now, mainly going closer to home,” Mitchell said.
Demand for travel within Australia has jumped 20 per cent at Intrepid, he noted. The company was booking tours to the Northern Territory, the Kimberley in Western Australia and Cape York.
As for the future of tours in Europe and the Middle East, things are less clear.
Destination Artisans caters to well-to-do couples and families with tailored, private tours of places in France and Belgium, but it doesn’t arrange their flights.
Co-founder Norma Keshishian said her company was not “directly affected” by the Middle East conflict. “However, my total number of trips confirmed is much lower than last year.”
“I think people are just spooked and not travelling; certainly bookings to France are down from last year.”
The government’s travel warning hangs over the industry too. The Department of Foreign Affairs and Trade maintains a level four “Do not travel” warning for Dubai, Abu Dhabi and Qatar. Even for Australians willing to chance it, travel insurance typically won’t cover the stopover.
Insurer Allianz notes that “if a traveller transits through, or stops over in, a country that is subject to a “Do Not Travel” warning from the Australian government (Smartraveller), cover may be limited for any claims that arise in connection with that country or events linked to that warning”.
That’s even as the policy can remain in effect for other destinations in Europe or Singapore. The elevated uncertainty is enough to dissuade travellers from spending tens of thousands of dollars on booking a tour.
Adam Schwab, co-founder and CEO of Luxury Escapes, said losses of up to 80 per cent in the first month for the tour operator industry were “pretty standard”.
Volumes for Luxury Escape’s travel package business and its online travel agency both fell dramatically in March, but have since recovered, he said.
But revenues for its tour business have been hit harder. They dropped as much as 80 per cent in March and were still down 50 per cent, Schwab said, with tours to places like Morocco and Egypt “significantly impacted”.
“We’re definitely seeing a drop-off,” he said.
Since the conflict began, some people who had already booked a tour were either going ahead despite the uncertainty, or postponing. And yet others were shopping for trips, but not booking.
Schwab said travellers were now pivoting to destinations like Bali, Fiji, Vietnam and the Maldives, while deferring larger-scale tours. The preference could be seen in data generated through the company’s websites.
“Middle Eastern products generally aren’t converting [selling] particularly well,” said Schwab. Consequently, they ranked lower on the offerings to customers.
Meanwhile, Fiji has recorded its highest-ever March arrivals, 71,765 visitors, up 12 per cent from March 2025. Australians accounted for 43 per cent of the total, up 17 per cent from last year.
In this climate, Luxury Escapes has high hopes for its launch of charter flights to the Maldives from May 18. The flights from Melbourne to the Maldives in the Indian Ocean allowed passengers to avoid flying through the Middle Eastern hubs of Qatar or the United Arab Emirates, and cut what would be a 20-hour journey to 10 hours, Schwab said.
Any unsold tickets would be covered by the Melbourne-based tour operator – part of a deal that was years in the making.
But how long the charter foray lasts depends on what happens to fuel costs. The fuel costs for the flights were hedged for the first six months, making pricing on the charters competitive, said Schwab.
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Chris Zappone is a senior reporter covering aviation and business. He is former digital foreign editor.Connect via X, Facebook or email.
