When airspace over the UAE and Qatar closed on February 28, 2026, the immediate story was operational. Flights were cancelled, hubs went quiet, and passengers were stranded. Four months later, the more durable story is a financial one. The conflict did not create weaknesses in how Gulf and wider MENA airline payments work. It exposed weaknesses that were already there, and it did so at a scale the industry had not stress tested.
The shock, in numbers
The scale of the initial disruption is now well documented. On the first day of the conflict, roughly 37 percent of Middle East flights were cancelled or did not operate. Within days, that cancellation rate peaked above 65 percent, with more than 2,300 daily departures grounded, according to Cirium. The firm’s rough estimate puts the number of passengers affected by cancellations between February 28 and March 11 alone at around 5 million, a figure Cirium itself flags as a high level approximation that excludes intra-Middle East flights.
The concentration of that impact matters as much as its size. Cirium’s route data shows Emirates alone carries more than 13 percent of Europe to Asia passengers and over 31 percent of Europe to Australasia traffic, with Qatar Airways and Etihad adding further concentration on the same corridors. A small number of Gulf carriers account for a disproportionate share of the world’s longest, most transfer-dependent routes. When those carriers are disrupted, the effect does not stay regional.
By mid April, the immediate cancellation shock was easing. Emirates was operating at roughly 68.7 percent of pre war levels, Etihad at 60.5 percent, and Qatar Airways at 53.2 percent, based on Flightradar24 data. The capacity shock was not easing at the same pace. Cirium’s later analysis found that scheduled capacity at Dubai and Doha was still down around 50 percent year on year in the second half of April, across flights, seats, and available seat kilometres. Operational recovery and network recovery were moving on two different timelines, and the second one is the slower story.
The World Travel and Tourism Council put a price on the disruption early, estimating in March that the conflict was costing the Middle East travel sector at least 600 million dollars per day in international visitor spending, measured against a pre conflict 2026 forecast of 207 billion dollars for the region. The major regional hubs, Dubai, Abu Dhabi, Doha, and Bahrain, together normally process around 526,000 passengers per day. Every day of closure or reduced operation at that scale translates directly into disrupted payment flows, not just disrupted itineraries.
Where the strain actually lands
The operational numbers explain what happened to flights. They do not explain what happened to money. Five specialists interviewed separately by The Paypers in March 2026 reached a similar conclusion from different angles: the disruption is exposing risks in FX, chargebacks, liquidity, and reconciliation that sit outside the card rails themselves.
Maarten Rooijers, founder of Payments Taking Off, argued that the FX exposure matters more than any drop in authorisation rates. Most currencies in the Middle East are pegged or closely linked to the US dollar. When carriers shift capacity away from the region and toward Asia, Africa, or Latin America instead, they pick up revenue in currencies without that dollar link, at the same time the dollar itself has been strengthening. Airlines are left managing that currency risk on top of an already volatile fuel hedging picture.
Will Plummer, CEO of Repayd, described the chargeback dynamic as a reallocation of liability rather than simply a rise in disputes. The financial burden of conflict driven cancellations is falling disproportionately on merchants and acquirers, despite the cause sitting entirely outside their control. His concern is less about the immediate cost than the second order effect: if acquirers conclude the travel sector carries more risk than they priced for, their appetite for the sector contracts, bringing tighter underwriting and higher rolling reserves for everyone in it, not just the carriers directly affected.
Livia Vite, CEO of actuary aero, pointed to a specific fraud pattern rather than a general rise in fraud. Cancellations are increasingly happening two to three weeks before departure, as airlines wait for clarity before making operational decisions. That compressed window is producing a surge in chargebacks filed under extraordinary circumstances claims, sometimes alongside a separate refund request for the same booking, a form of double dipping that is not always intentional but creates a genuine reconciliation problem for merchants managing high cancellation volumes.
Sami Doyle, CEO of TMUManagement, framed the structural risk most directly. Chargeback exposure for airlines, tour operators, and hotel groups has historically been modelled against demand shocks that are localised and short lived. What the region has experienced instead is correlated cancellation events across multiple carriers and markets at once, with refund timelines extending well beyond standard chargeback windows. Bookings made months in advance create exposure that sits quietly on an acquirer’s balance sheet until disruption forces it to the surface, which means the real question is not what current chargeback rates look like, but what forward exposure looks like if instability persists through a peak booking cycle.
The consistent thread across all five views is that card scheme rules themselves are holding up. Cross border transactions are still processing normally. The friction sits around the transaction, in settlement timing, liquidity, and reconciliation across currencies, not inside the payment rails.
A structural problem, not a new one
It would be a mistake to treat any of this as a symptom unique to 2026. IATA’s blocked funds data for the end of October 2025, published in December, months before the conflict escalated, already showed 1.2 billion dollars in airline revenue blocked from repatriation by governments worldwide. Of that total, 93 percent, or 1.12 billion dollars, sat in a combined Africa and Middle East reporting bucket spanning 26 countries. Algeria topped the list at 307 million dollars, followed by the six country XAF zone at 179 million, then Lebanon at 138 million.
The numbers matter because the problem predates the conflict. IATA identified currency repatriation restrictions, foreign-exchange shortages, and burdensome or inconsistent approval procedures among the factors behind blocked airline funds. The February disruption did not introduce those vulnerabilities. It tested them at scale.
They are what happens when FX exposure, refund liabilities, settlement timing, and repatriation constraints collide during a correlated disruption. That is the lesson worth carrying forward. The next shock does not have to be geopolitical to produce the same pressure.
The story here is not that a war disrupted Gulf airline payments. It is that aviation recovered operationally faster than the financial exposure disappeared, and the conflict revealed how much risk sits between the moment an airline sells a ticket and the moment it finally gets to keep the money.
