At Cover Page Media, we bring to you the latest updates from the world of travel. In view of the escalating Middle East crisis, the airline industry discovered a loop hole that no one ever realized before.
Escalating geopolitical tensions in the Middle East
The crisis has led to recent widespread airspace closures over Iran, Iraq, and Gulf states including Qatar, Kuwait, Bahrain, and the UAE. As a result, it has majorly disrupted global air travel and particularly affecting routes between Europe, Asia, and North America. Why? Because these routes rely on the Gulf as a critical transit corridor. With the three dominant Gulf carriers Emirates, Qatar Airways, and Etihad Airways, either suspending flights or rerouting around conflict zones, the ripple effects of the crisis is being felt across the world’s aviation and tourism sectors.
This closure of the key air corridors has forced airlines to adopt longer, costlier flight paths, increasing fuel consumption, crew scheduling challenges, and insurance costs like we have mentioned on the previous articles. Two major airports- Dubai International Airport, which in 2025 handled 95.2 million passengers, and Doha’s Hamad International, which is a major global hub, have seen hundreds of flights cancelled. In a 24-hour period, Emirates and Qatar Airways each suspended over 400 flights, disrupting connections for millions of passengers.
Indian Airlines Hit Hardest by Gulf Airspace Shutdown
But globally, Indian carriers are among the most severely affected. This is due to Indian Airlines heavy reliance on Gulf transit routes. According to India’s Directorate General of Civil Aviation (DGCA), in just two days over 850 Indian flights were disrupted (28th February–1st March 2026), along with 410 cancelled on 28th February and 444 on 1st March. Serving as a crucial link for both direct travel and onward connectivity to Europe, Africa, and North America, the Gulf region accounts for more than 50% of India’s international passenger traffic.
Indian airlines operate fewer wide-body aircrafts, unlike Gulf carriers, and also lack the hub-and-spoke flexibility that Emirates or Qatar Airways posese. And also considering that the Pakistani airspace is also closed to Indian carriers, rerouting options have become limited, forcing flights to take longer detours. These often include via Saudi Arabia or around the Arabian Peninsula, which adds almost 1–3 hours to flight times and as a result significantly increasing fuel costs.
Major Indian Carriers Forced to Cancel Long-Haul and Regional Flights
Approximately 50 long-haul flights were suspended by Air India, to Europe and North America, also including services from Delhi to London, New York, Frankfurt, Amsterdam, and Toronto. All these cancellations occurred because the normal flight paths crossed restricted airspace. On the other hand, IndiGo, India’s largest airline by domestic market share, cancelled numerous flights to the Gulf and Europe too. This took place because the airline operates long-haul Boeing 787s on lease from Norse Atlantic Airways, and so must comply with European Union Aviation Safety Agency (EASA) directives requiring avoidance of Iranian, Iraqi, and Gulf airspace.
Indigo and Air India aren’t the only ones to suffer from the crisis- other carriers like SpiceJet, Air India Express, and Akasa Air too faced operational disruptions. Mumbai’s Chhatrapati Shivaji Maharaj International Airport saw a rapid 57 flight cancellations in one single day, including IndiGo’s London route.
The Financial and Operational Crisis for Indian Aviation
Now, ofcourse a large scale conflict like this is to trigger a financial crisis for Indian airlines. Airlines that are not to mention, already recovering from their pandemic-era losses. The analysts estimate that the crisis has caused an initial Rs 500 crore (approx. $60 million) loss in profits, with continous losses expected if airspace restrictions persist. Rising Brent crude prices are up 7–10% due to these regional tensions and have increased aviation turbine fuel costs, which is already a major expense for airlines.
Another cost increasing is the War-risk insurance premiums that is adding to operational costs. The longer flight times also strain crew duty hour limits, complicate scheduling, and reduce the aircraft’s utilization. With belly cargo capacity also slashed due to passenger flight cancellations, air freight rates are surging, we wrote an article on this too. All this is aslo impacting time-sensitive exports like pharmaceuticals and electronics.
Stock Market Reaction To This Crisis
Now as a result of all of this, the investors’ confidence in Indian aviation has really plummeted. The shares of InterGlobe Aviation (IndiGo) fell nearly 7%, SpiceJet dropped over 8%, and travel-tech firm ixigo declined more than 5%, al on 2nd March 2026. These aren’t the only ones, railway and tourism-linked stocks also suffered, reflecting broader risk aversion.
Indian expatriates in the Gulf especially and other passengers faced major disruptions and continue too. Rebookings are surging, while alternative routes are scarce, and the fares on these unaffected corridors are surmounting. Many travelers are stranded or facing extended layovers, particularly in Dubai and Doha.
Indian Airlines are Adopting Strategic Measures to Reduce Dependency on Gulf Hubs:
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Alternate Routing: Air India is successfully rerouting Europe and US-bound flights via Saudi Arabia, Egypt, the Red Sea, and the Mediterranean, bypassing the conflict zones in Iran and Iraq. These adjusted flight paths, supported by Boeing 777s and 787 Dreamliners, are to maintain connectivity while also enhancing fuel efficiency on longer detours.
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Expansion of Direct and Alternative Routes: Airlines are increasing flights to non-Gulf hubs such as Colombo (Sri Lanka) and Malé (Maldives). Air India Express has resumed services to Muscat, while IndiGo operates special flights from Jeddah, leveraging approved alternate corridors.
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Infrastructure and Bilateral Advocacy: The Directorate General of Civil Aviation (DGCA) has approved Muscat International Airport as a key alternate routing point for Gulf-bound traffic. Indian carriers are also pushing for expanded air rights with Saudi Arabia and Oman to establish conflict-resilient air corridors.
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Long-Term Fleet and Network Growth: With Air India and IndiGo ordering nearly 1,000 new aircraft, India aims to boost long-haul capacity. This will enable more non-stop flights from Indian metros to Europe and North America, reducing reliance on Gulf transit.
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Strengthening Regional Connectivity: IndiGo has launched their new routes to Bahrain and Muscat from Tier-2 cities like Kochi and Hyderabad, this is to target labor and diaspora traffic directly without funneling through Dubai or Doha.
Signs of Recovery: Airlines Begin Restoring Services
As of 7 March 2026, there are signs of recovery. Emirates announced plans to restore 100% of its network, with 11 daily flights to UK airports and 22 to Indian destinations by early March. Air India, Qatar Airways, and Lufthansa are also resuming long-haul services, rerouting flights through safer corridors. However, normal operations may take days or weeks to fully stabilize.
The crisis underscores the fragility of global air travel when concentrated through a few regional hubs. For Indian airlines, the episode highlights strategic vulnerabilities in route planning, overflight access, and reliance on Gulf connectivity.
At Cover Page Media, we bring to you the latest updates from the world of travel. While the situation seems to get better, it is still quite volatile and the Indian airlines industry doesn’t seem to get a break to recover it’s costs for sometime.
