Iran war to dent passenger volumes, Heathrow warns

Heathrow warned creditors that the Iran war is likely to reduce passenger volumes at the west London airport, while also criticizing a new regulatory model being proposed by the aviation watchdog. In a bi-annual update to bondholders, Heathrow Airport Limited said passenger numbers for the first five months of 2026 rose 0.7%, but geopolitical events are creating “notable downward pressure” for the full-year outlook. It now expects traffic between 84.5 million and 80.1 million passengers, with a base case of 83.6 million, a 1.1% year-on-year decline. Heathrow said continued Middle East volatility could dampen broader global travel demand. The company tied the risk to the months-long conflict, after the closure of the Strait of Hormuz disrupted a vital shipping lane for aviation fuel and pushed kerosene prices to more than double early in the war. In the same report, Heathrow said the Civil Aviation Authority’s framework does not provide “a clear or investable pathway” and set out concerns that proposed passenger-charge levels remain below what it demanded. The CAA is due to publish final proposals in November 2026, with a decision expected in April next year.