Due to continuous conflicts in West Asia and a substantial increase in aviation fuel prices, it is predicted that the worldwide airline industry will earn only half the amount of profits in 2026 compared to previous years. This prediction has been made based on the most recent financial statement of the International Air Transport Association (IATA).

The IATA predicts the total net profit for worldwide airlines to be approximately $23 billion in 2026, which is slightly less than half the predicted net profit of $45 billion in 2025.

IATA Director General Willie Walsh said, "Disruptions caused by the war in West Asia and rising fuel costs have weakened the airline industry's outlook." He added, "Globally, airline profitability is expected to halve compared to 2025. Profits will fall from $45 billion to $23 billion, and profit margins will decline from 4.2 percent to 2.0 percent."

According to IATA, the industry's net profit margin is projected at 2 percent in 2026, down from 4.2 percent in 2025. Net profit per passenger is also projected to fall from $9.10 to $4.50. The organization said the biggest challenge facing airlines is the sharp rise in fuel costs. The average price of jet fuel is projected to be $152 per barrel in 2026, an increase of nearly 70 percent from the $90 per barrel average in 2025.

"The sharp 70 percent increase in jet fuel prices is impacting the profitability of all airlines," Walsh said. "Some of the additional costs are being recovered through fare adjustments and increased operational efficiency, but this will not be sufficient to maintain last year's level of profitability."

Despite the decline in profits, the airline industry's total revenue is projected to reach a record $1.165 trillion in 2026, a 9.4 percent increase from $1.065 trillion in 2025. Passenger numbers are projected to increase 2.4 percent to 5.1 billion, with a record occupancy of 84 percent of available seats.

Passenger ticket revenue is projected to reach $839 billion. Ticket yields are projected to increase by 7 percent as airlines increase fares to partially offset the fuel cost shock.

However, IATA warned that operating expenses will rise faster than revenue. Total industry costs could rise 13 percent to $1.117 trillion. Fuel expenses, the largest contributor, are projected to rise nearly 40 percent to $350 billion.

The organization said the airline industry has already been operating on low profit margins, so this situation poses additional challenges. "Airlines are bearing the brunt of the fuel price shock," Walsh said.

He added, "Net profit per passenger is projected to fall to $4.50, half of last year's figure. This reflects the industry's resilience under current circumstances. But this figure isn't enough to buy a hot dog at most FIFA World Cup hosting sites and offers little protection if other costs or taxes rise."

Regionally, IATA said all major airline markets, except West Asia, are expected to remain profitable. Airlines in West Asia could face losses due to flight disruptions, airspace restrictions, and reduced transit traffic caused by the conflict.

"Airlines in the Gulf region have faced operational uncertainties, including near-complete airspace closures since the war began," Walsh said. "These airlines are doing a great job maintaining connectivity, but the financial impact is unavoidable."

IATA also identified slower global economic growth, rising inflation, disruptions to the aircraft supply chain, and geopolitical uncertainties as key risks facing the airline industry in 2026.