Despite rising energy prices and inflationary pressures linked to the ongoing war in the Middle East, demand for international travel has reached a new high.
Record Sales Amidst Global Instability
Sales of summer vacation packages have increased by 5% compared to 2025 and by 20% compared to the accumulated figures from the past two years, according to data from the National Association of Travel Agencies (ANAV).
According to Miguel Quintas, president of ANAV, “Portuguese people continue, to want to travel and, despite the increase in the cost of living, they are not stopping buying. This is almost scientific and has been proven in the last crises we have gone through; even if prices rise, people maintain the budget allocated to vacations and do not reduce it.”
ANAV indicates that travelers are adapting by choosing more affordable destinations when prices increase. “If prices rise in a certain destination, people redirect their choice to other geographies that can fit within the budget they have allocated for their vacation. They don’t cut back, nor do they travel less, they opt for cheaper countries,” Quintas explained.
Impact of Conflict on Travel Costs
While prices have increased since the start of the conflict in the Middle East – particularly impacting aviation – package deals have not yet been affected. This is due to advance contracts for flights, including charters and ACMI agreements, which are often secured a year in advance to mitigate price volatility.
Those booking travel independently are facing higher costs, with flight prices to Europe up 7% and long-haul flights up approximately 15% since the start of the war.
Tourism Shift to Portugal
Portugal, along with Spain and Italy, is benefiting from a redirection of tourists previously headed to the Middle East. Approximately four million tourists who had planned to visit Saudi Arabia are now seeking alternative destinations, a trend already noticeable during Easter. This influx could lead to inflationary pressures, particularly in the Algarve, potentially making domestic vacations less affordable for Portuguese residents.
The Caribbean and Tunisia remain competitive alternatives to southern Portugal. Families are also adjusting their plans, with those who had trips booked to the Middle East or Asia rescheduling for later in the year. Brazil is experiencing “very high” growth in sales, while Mexico and the Dominican Republic are emerging as alternatives following travel disruptions to Cuba. Cabo Verde remains a popular choice.
Frequently Asked Questions
What is happening with travel package prices?
Package prices have not yet increased because many summer packages were contracted before the war in the Middle East.
How are flight prices being affected?
Flights to Europe have increased by 7% and long-haul flights by around 15% since the start of the conflict.
Where are tourists who previously visited the Middle East going instead?
Tourists are redirecting their travel plans to destinations like Portugal, Spain, Italy, Brazil, Mexico, the Dominican Republic, and Cabo Verde.
As global events continue to unfold, how might shifting travel patterns impact both the tourism industry and the vacation plans of individuals?
