Middle Eastern airlines experienced modest growth in air cargo demand in July, while international passenger traffic decline slowed as recovery efforts through Gulf hubs continued, according to industry data.

The region recorded a 1.7 percent rise in air cargo demand compared with the same month last year, driven by expanding cargo capacity that grew 4 percent year-on-year. Despite this growth, cargo load factors in the Middle East decreased by one percentage point to 44.1 percent, reflecting an expansion in available capacity outpacing demand. The Middle East accounted for 13.2 percent of the global air cargo market in 2025, ranking as the fourth-largest after Asia-Pacific, North America, and Europe.

Passenger operations showed mixed performance. International passenger capacity among Middle Eastern carriers declined by 5.8 percent annually in July, with the load factor dropping 3.3 percentage points to 80.9 percent. Overall, including domestic and international flights, demand fell 10 percent and capacity decreased by 6.2 percent. The total load factor across all operations stood at 80.7 percent, down 3.4 percentage points from the previous year.

Globally, passenger demand grew by 0.2 percent in July, expressed in revenue passenger-kilometers. Excluding the Middle East, this figure rose by 1.2 percent. International passenger demand worldwide fell 0.1 percent but would have seen a 1.5 percent increase without the Middle Eastern data. Marie Owens Thomsen, senior vice president for sustainability and chief economist at the International Air Transport Association (IATA), emphasized the continued recovery at Gulf hubs. She noted that despite challenges such as high fuel prices, economic uncertainty, and geopolitical tensions, airlines are optimistic about demand for the year's final months and plan nearly a 3 percent increase in seat capacity in September.

However, key cargo routes linked to Gulf hubs have suffered amid ongoing regional conflicts. Traffic between Europe and the Middle East declined 16.1 percent in July, while the Middle East–Asia corridor contracted by 14.1 percent for the fifth consecutive month. These decreases contrasted with global trends where air cargo demand grew 3.9 percent overall and 4.7 percent for international routes. Capacity globally rose by 1.7 percent and 1.8 percent for international operations.

The air transport industry also contends with rising operational costs. Jet fuel prices surged by 22.2 percent compared to June and were up 56.9 percent year-over-year, compounding financial pressures on carriers even as global trade expanded 7.5 percent from the previous year.