Heathrow has told its creditors the Iran war will dent passenger volumes at the west London hub in an update in which it also railed against plans for a new regulatory model being proposed by the aviation watchdog.

In a bi-annual report aimed at its bondholders, Heathrow Airport Limited (HAL) said that despite the regional conflict, passenger volumes for the first five months of 2026 had risen by 0.7 per cent. But it added that geopolitical events were “putting notable downward pressure” on the number of customers it will attract over the full year.

Heathrow now expects a traffic range of between 84.5m and 80.1m, with a base case of 83.6m, it said, representing a 1.1 per cent fall year on year.

The downward estimate “reflects the risk that continued volatility in the Middle East could dampen broader traffic volumes, with impacts extending beyond the region to global travel demand over the remainder of the year”, according to a statement from HAL.

The aviation industry has been bracing for the ill effects of the months-long US-Iran war, after the closure of the Strait of Hormuz shipping lane choked off one of the most vital pinch points for aviation fuel. The conflict led prices of the refined oil – known as kerosene – to more than double at the outbreak of the war.

The spiralling cost of fuel has forced some carriers to raise air fares, though the likes of Ryanair and British Airways owner IAG have revealed hedging arrangements that has helped soften the fallout.

As part of the same update, HAL launched another broadside on the aviation watchdog’s plan to overhaul its regulation of Heathrow. The airport’s operator, which runs a natural monopoly and is the world’s most expensive airport, has previously warned the Civil Aviation Authority’s (CAA) bid to crack down on the hub’s spending and charges would undermine its “efforts to improve the airport”.

And in its report on Friday, it unleashed a second salvo, saying the regulator’s proposed framework did not provide “a clear or investable pathway”.

“Heathrow has proposed targeted adjustments to ensure the final settlement supports delivery of improved consumer outcomes,” HAL added.

In March, the CAA published a revamped plan for Heathrow regulation, which largely ignored a frenzied lobbying campaign from airport to raise its fees to fund a glut of infrastructure upgrades and capital expenditure.

Under the plans, Heathrow would remain the most expensive major airport in the world. But it proposed an uplift in the ‘passenger charge’ it could levy on airlines – which is the airport’s main revenue stream – that was considerably below the level demanded by HAL top brass in the run-up to the plans.

The CAA is set to publish its final proposals in November 2026, and its final decision is expected in April next year.

The CAA was approached for comment.