Tourism Spending Set for $1.8 Trillion as Arrivals Growth Slows

A record on paper, a slowdown underneath

International tourism is heading for another record year in 2026, but the gains are increasingly coming from higher prices rather than more trips. The 2026 WTM Global Travel Report, produced by WTM London with Tourism Economics, forecasts 1.57 billion international overnight arrivals this year. It expects international visitors to spend $1.8 trillion.11 Arrivals are projected to grow 2% over 2025, while spending by international visitors is expected to rise 6%.1112 Counting domestic and international travel together, in-destination spending is forecast to climb 9% to $7.8 trillion.1118

Those numbers make a strong headline, but the report's own figures show weaker momentum. International arrivals grew 6% in 2025, and Tourism Economics now expects that pace to fall to 2% this year.1113 The report blames the Middle East conflict, higher jet fuel prices and cost-of-living pressures for holding back demand. It credits domestic and short-haul travel with keeping the industry growing.1112

The main point to take from the report is the gap between spending growth of about 6% and arrivals growth of about 2%. Most of the record spending figure reflects higher prices rather than more travellers. The European leisure spending figures in the report are explicitly given in nominal US dollars and are not adjusted for inflation, which supports that reading.18

The official data is even weaker

The private-sector forecast is actually brighter than what UN Tourism has measured so far. Its September World Tourism Barometer counted about 690 million international tourists from January to June 2026. That is about 3 million more than a year earlier, or growth of just 0.4%.1 Arrivals rose 2% in the first quarter and then fell 1% in the second. April was down 3%, partly because Easter fell in March this year and partly because of the conflict.15

June was weak too. Global arrivals fell 3% that month, including a 6% drop in Western Europe that UN Tourism partly linked to heatwaves.1 UN Tourism has now cut its full-year forecast to growth of 1% to 2%, down from the 3% to 4% it projected in January. It says the final figure depends on how long the conflict lasts and how it affects oil prices and inflation.210 This was the second downgrade of the year, after an earlier cut in June following the first-quarter data.34

The two outlooks overlap at roughly 2%, but they describe the year differently. The WTM report calls 2026 another record year.11 UN Tourism Secretary-General Shaikha Al Nuwais put it more cautiously: tourism has kept growing, but that growth is fragile.414 Both statements can be true. A slowing industry can still set records when it starts from a historically high base. UN Tourism counted 1.52 billion international arrivals in 2025, a record and 2% above 2019.14 Even so, the cautious reading fits the data better. UN Tourism's expert confidence score for May to August fell to 105, from 117 for January to April. That shows confidence fading during the very months the summer season depends on.47

The figures also vary between publications. One account of the WTM report puts total visitor nights at 24.2 billion, while another gives 23.9 billion.1118 Some secondary statistics sites quote 2025 arrivals of about 1.6 billion, above UN Tourism's official 1.52 billion.1416 Different definitions explain part of this. WTM counts overnight arrivals and in-destination spending, while UN Tourism reports tourist arrivals and receipts. Readers comparing the numbers should keep those differences in mind.

Airfares: the cost shock behind the summer season

Airfares are the clearest reason the slowdown happened. The conflict that began in March largely stopped tanker traffic through the Strait of Hormuz, the route for about a fifth of the world's oil supply.30 Within two weeks, the average US jet fuel price rose from $2.50 a gallon to $3.99.28 By early April, jet fuel prices had roughly doubled in two months.21

Airlines took several months to pass these costs on to passengers. In April, Hopper reported that summer domestic fares were up about 10% because of fuel.21 United CEO Scott Kirby said fares would need to rise 15% to 20% to cover the cost and called that "probably the new normal."25 US consumer price data showed airline fares up 14.9% year on year in March22 and 20.7% in April.23 By the end of summer, US fares were up about 25% compared with 2025.27

Airlines also raised costs in other ways. United and JetBlue increased checked-bag fees by $10.21 Delta, United and American cancelled more than 5,000 routes between May and September.25 Carriers cut the midweek, Saturday and red-eye flights that budget travellers rely on.2127 For many leisure travellers, this meant fewer cheap seats as well as higher fares.

The problem extended well beyond the US. IATA estimated that airlines would spend an extra $100 billion on jet fuel this year and that industry profits would fall by half, to $23 billion. Director General Willie Walsh said higher ticket prices were unavoidable.26 UN Tourism said the jet fuel price spike and shortages in some markets were pushing up fares and reducing flight capacity outside the Middle East as well.3 It also linked weaker demand within Asia-Pacific to higher fares and disrupted air links.110

Travellers are still spending, but more carefully

The coverage agrees on one point: higher prices have not stopped people travelling, but they have changed how they travel. Travellers have shifted from long-haul trips to closer destinations. Globally, travel between regions fell 3% while short-haul trips rose by the same amount, according to Tourism Economics.11 This helped Europe, where arrivals are forecast to rise 5%, and Africa and Oceania, both forecast to grow 8%.1115 IATA's data pointed the same way, showing more British and European travellers flying within Europe because of uncertainty around Gulf hubs.26

Tourism Economics' Dave Goodger said travellers are spending selectively on the experiences that matter most to them or staying closer to home.11 UN Tourism likewise expects travellers to keep looking for value, with more domestic and nearby trips.56 Value for money has become a much bigger factor in choosing a destination, according to the WTM report.12

The airlines' own results suggest consumers have accepted higher prices more readily than many expected. Delta said five of its best sales days ever came after the war started.21 Half of passengers surveyed by IATA said they were prepared to pay considerably more if fares tracked oil prices.26 In October, Delta's Ed Bastian argued that the higher fares are "sustainable" even if fuel costs fall, because travellers have accepted them.27 Analyst Zach Griff made a similar point: fares that rise rarely come back down at the same speed.21

In this author's view, this is the most important consumer issue in the story. If travellers keep paying higher fares, those prices may stay even after fuel costs ease. Part of the record $1.8 trillion would then be a lasting increase in the cost of travel, not just a sign of strong demand.

The United States and the Middle East are the weak spots

The regional picture is uneven. North America is forecast to grow only 2% in 2026 despite hosting the FIFA World Cup, and its visitor numbers remain 6% below 2019. The report blames high travel costs and negative sentiment towards the United States.11 US international arrivals fell 5.5% in 2025 to 68.3 million, mainly because arrivals from Canada dropped 20.9%.14 Spending by international visitors to the US from January to July 2026 was flat compared with a year earlier.14

US travel spending as a whole still depends heavily on domestic trips. The U.S. Travel Association forecasts record spending of $1.37 trillion in 2026, and 87% of it is domestic.14

The Middle East has been hit hardest. Arrivals there fell 22% in the first half, after a 14% fall in the first quarter.47 Air traffic began recovering after a ceasefire in May and early June, but UN Tourism described the rebound in consumer confidence as uneven.2 Asia and the Pacific remains 11% below 2019 levels, and weaker outbound travel from China is adding to the drag.111

What 2027 depends on

Tourism Economics expects international arrivals to grow 8% in 2027, with long-haul travel rebounding 11%, if the disruption eases. It also forecasts a 43% recovery in the Middle East, though that would still leave the region below its 2025 level.1118 Beyond that, it projects about 6% annual growth to 2.2 billion arrivals by 2032.11

The report itself warns that continued conflict could delay this recovery.18 Airline executives are not planning for cheaper fuel soon. United assumes fuel will stay expensive through 2027, and jet fuel costs in the third quarter were more than 60% above a year earlier.27 On that evidence, the 2027 rebound is a best-case scenario rather than a base case. The more likely outcome is that travel continues to grow but stays expensive, with more trips taken closer to home.