The travel sector is already feeling the strain from soaring fuel costs and supply concerns about the energy crisis, with airlines cutting capacity, Europe concerned about energy security, and travelers shifting toward trains, staycations, and drive-to destinations. New booking data suggests the impact is no longer just about sentiment: it is now showing up in how and where people plan to travel.

The Energy Crisis Hits Travel—And Predictions Are Not Positive

The New York Times reported that oil prices soared, hitting a new wartime high, on Thursday, as President Trump asserted the blockade on the Straits of Hormuz will continue until Tehran gives up its nuclear program.

It prompted David Wallace-Wells in the same paper to call it an ‘Everything War’, summing up some of the issues affecting travel and lifestyle since the war began:

• Countries around the world have instituted working-from-home policies and four-day workweeks.
• Americans have spent an extra $15 billion on gas since the war began.
• The International Energy Agency warned a couple of weeks ago that there might be only six weeks of jet fuel left.
• Airlines like Lufthansa are cutting 20,000 flights to save fuel, and in the US, low-cost airlines are facing bankruptcy.
• And the implications on food production and transport might be even more disastrous, with what The Financial Times has called “the coming global food crisis.”

In Europe, the International Energy Agency has tabled proposals to save energy, such as working from home and traveling less, and the travel industry is already seeing signs of a drop-off in bookings in some places. And European Commission President Ursula von der Leyen has said that the conflict is costing the EU nearly 500 million a day in higher energy costs.

Politico reported this week on another factor causing concern: Europe has knowledge gaps in real-time monitoring and analysis of its oil and gas reserves, leaving it a little in the dark about how much fuel remains, which may affect when and how it makes emergency decisions.

The German Chancellor, Friedrich Merz, warned that the war in Iran could have a similar economic fallout to rival COVID or the Russian invasion of Ukraine, saying it's “beyond what we could imagine” in terms of energy crises.

The Energy Crisis Is Impacting Global Tourism Bookings, Not Just Sentiment

The result is that vacation costs are increasing and there are already signs that the conflict and surrounding fears of energy supplies and safety are having an impact on decisions around holiday bookings:

• The digital ticketing platform TrainPal has seen a sharp increase in domestic train travel in the U.K. since fuel shortages were announced. April witnessed their highest-ever U.K. train ticket sales, up almost 40% year-on-year from last April.
• According to the European Travel Commission’s latest Monitoring Sentiment for Intra-European Travel report, while 82% of Europeans still intend to travel this summer, they plan to do so within Europe, and travelers are becoming more cautious, planning fewer, shorter trips with more moderate budgets.
• As an example, from an Ifop survey for Alliance France Tourisme, Euronews reports that the French are planning to travel less and spend less this summer.
• In the U.S., data suggest demand for long-haul flights is softening, and Americans are planning more staycations this summer. Recent data from the global vacation company Trafalgar found that North American sales for U.S. travelers are up 13% year-on-year.
• According to Going, Florida, Mexico, and the Caribbean are posting the strongest flight deal activity of the year.
• Club Wyndham reports that demand is strongest in drive-to vacation markets like Florida (up 10% year-on-year) and the Carolinas and Georgia (up 7% Year-on-year).

It's clear, then, that the energy crisis caused by the conflict is not only raising prices but reshaping demand, with the early winners being closer to home trips, and rail and road vacations.

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