The news: Airlines are bullish on travel demand even as war in the Middle East threatens to disrupt operations and causes fuel costs—and ticket prices—to skyrocket.

• Delta now expects revenues to rise between 6.8% and 9% YoY in the current quarter, a significant upgrade from its prior forecast of 5% to 7% growth.
• American Airlines forecast revenue growth of at least 10% in Q1, which would be the largest YoY increase in quarterly revenues in the carrier’s history.
• United’s flight demand has increased since the war in Iran began, CEO Scott Kirby told The Wall Street Journal.

Zoom out: Several factors are contributing to resilient demand in the short term.

Higher-income consumers continue to spend freely. Not only do they want to travel, but they are less sensitive to higher ticket prices and more inclined to purchase high-margin premium seating. That dynamic is benefiting airlines like Delta, which generates over 90% of its revenues from wealthy customers, as well as United, American, and other carriers with extensive premium availability.

Americans overall remain eager to travel.

• Over half of US adults—56%—plan to travel as much as or more in 2026 than they have over the past two years, while 72% expect to maintain or increase travel spending, according to a January survey conducted by YouGov for The Points Guy.
• Nearly two-thirds (61%) of Americans plan to travel this spring, up from 48% who said the same last year, per RetailMeNot.

Some consumers may be booking travel now to avoid higher fares later—possibly contributing to the surge in demand at United, Delta, and American.

Consumers are less sensitive to geopolitical turmoil. “People don’t react as much” to overseas upheavals these days after the events of the past few years and “mostly…keep going on about life and business,” Kirby told The Journal.

Implications for the travel industry: For all of Delta’s optimism, an extended war in the Middle East could become a significant threat to global travel demand.

Rising fuel prices increase pressure on consumers’ wallets. Airlines are already hiking ticket prices in response to higher jet fuel costs, which could make all but the wealthiest consumers think twice about flying. At the same time, rising gas prices and other cost-of-living pressures could dampen demand for road trips, hurting domestic hotel and restaurant operators.

International tourists may steer clear of the World Cup. Concerns about the US involvement in Iran could dampen demand for inbound travel, which is already uncertain due to worries about restrictive immigration policies and other geopolitical tensions. That could cause further pain for domestic hospitality companies, many of whom were counting on the World Cup bump to offset softer demand from US and international travelers.