RIYADH: Geopolitical tensions in the Middle East, coupled with the closure of some airspaces, have led to a redirection of travel toward domestic destinations.
Growing demand for nearby, stable destinations with easier access within the Kingdom drove double-digit growth in domestic tourism, experts told Al-Eqtisadiah.
Data from the Ministry of Tourism confirms this trend, showing that the number of domestic tourists reached SR28.9 million ($7.7 million) during the first quarter of 2026, a 16 percent year-on-year increase.
Domestic tourism spending reached SR34.7 billion, an 8 percent increase compared to the same period of the previous year.
March coincided with the peak of the regional conflict that began on Feb. 28 between the US and Israel on one side, and Iran on the other, before engulfing all countries in the region.
Director of Corporate Communications at the Almatar app, Abdullah Khoja, stated that market indicators show a 48 percent shift in traveler behavior toward domestic destinations. This reflects the growing importance of flexibility in travel decisions, as customers are no longer solely focused on the cheapest ticket but also prioritize options that allow for easy booking modifications or refunds should circumstances change.
Operational costs, pressures on airlines
Khoja pointed out that rerouting flights to avoid conflict zones imposes additional burdens on airlines. These include increased fuel consumption due to longer distances and flight times, as well as fees for overflights. Airlines also bear the costs of rescheduling and accommodating passengers when flights are delayed or canceled.
Mahmoud Rakha, assistant tour manager at Elite Holidays Travel and Tourism, explained that travel platforms are moving toward offering more flexible options, including the ability to modify or refund bookings. This mitigates the impact of sudden changes on travelers’ plans. He noted that customers are increasingly demanding that bookings be refundable or modifiable, while some prefer to postpone booking decisions until closer to the travel date to avoid risks.
Saudi Tourism Minister Ahmed Al-Khatib affirmed that the significant growth in domestic tourism indicates that the tourism sector possesses the necessary elements and local demand drivers that enable it to confidently and stably face current circumstances and maintain the foundations for sustainable growth.
No sharp impact on ticket prices
Although jet fuel represents one of the largest cost items, its impact on ticket prices is not currently evident. Airlines are attempting to absorb some of this increase to maintain competitive pricing, especially on destinations not directly affected by the crisis, according to Rakha, who explained that ticket prices remain within their normal levels on unaffected routes, given the availability of flights and the stability of operating schedules.
Hotels gradually recover despite decline
The hospitality sector, one of the most sensitive to events, witnessed a decline in occupancy rates in some regional cities, particularly in Gulf destinations, which recorded high cancellation rates during peak periods.
Rakha explained that some regional destinations were significantly affected, with high cancellation rates, but forecasts indicate a gradual recovery as flight schedules stabilize and traveler confidence returns.
In contrast, government measures, including hosting stranded citizens in Makkah and Madinah, contributed to mitigating the impact of the crisis and supporting stable demand for accommodation. Rakha explained that demand for domestic tourism increased by more than 40 percent compared to last year.
Shaher Hijazi, tourism manager at the Arab Co. for Traveler Services, said that demand for domestic tourism grew by about 30 percent year-on-year, driven by safety and accessibility factors.
Hijazi added that this growth reflects a shift in travelers’ preferences toward domestic destinations, given the challenges associated with international travel, particularly flight schedule changes and cancellations.
This makes domestic tourism more stable and flexible during this period. He noted that the diversification of tourist destinations, along with improved services and expanded capacity in some cities, has contributed to enhancing the appeal of domestic tourism and increasing its ability to meet rising demand, especially during peak seasons.
AlUla, the Red Sea lead the shift
Specialty destinations like AlUla and the Red Sea Project have emerged as the biggest beneficiaries of this shift, recording a 37 percent increase in bookings, according to data from the Almatar app.
The assistant tour manager at Elite Holidays Travel and Tourism indicated that growth rates for these destinations range between 40 and 50 percent compared to the same period last year, and may reach 60 percent of total domestic bookings at certain times, especially with the development of tourism experiences in these destinations, in addition to the increase in events and improvements in infrastructure and services.
A look at the transformation: from challenge to opportunity
The President of the Saudi Tourism Association, Emad Manshi, explained that demand for domestic tourism has grown by 16 percent recently, coinciding with a 13 percent increase in inbound tourism, according to data from the Ministry of Tourism. This growth is primarily attributed to several factors, most notably the disruption of some flights in the region and the reduced efficiency of connections through some Gulf airports, which prompted a segment of travelers to redirect their plans toward domestic destinations.
Manshi indicated that the Ramadan and Umrah seasons contributed to boosting demand for Makkah and Madinah, while Red Sea destinations recorded high occupancy rates, reaching full capacity in some resorts. This highlights the readiness of the tourism infrastructure and its ability to accommodate demand.
He added that the diversification of destinations, along with the development of hospitality and transportation projects, such as the Haramain High-Speed Railway, has enhanced the domestic travel experience and facilitated movement between cities, contributing to the increased appeal of domestic tourism in recent times. He emphasized that the continued development of major tourism projects will support the achievement of the sector’s objectives, predicting that tourism’s contribution to the gross domestic product will reach 10 percent by 2030, while also creating millions of jobs and strengthening the sector’s role in economic diversification.
Makkah, Madinah most prominent domestic destinations
Hijazi stated that Makkah and Madinah top the list of the most sought-after destinations, followed by major cities such as Riyadh, Jeddah, and the Eastern Province, in addition to prominent tourist destinations like Abha, AlUla, and the Red Sea. He added that demand for Makkah and Madinah increased by more than 60 percent during religious seasons, while demand for destinations such as AlUla, the Red Sea, and Al-Khobar rose by approximately 50 percent after Ramadan.
Although tensions have led to a redirection of some tourism spending from abroad to domestically, due to the decline in international travel and the cancellation of some flights, Rakha noted that some travelers have opted for more stable alternative destinations such as Egypt, Turkiye, and Europe, which has resulted in higher travel and accommodation prices during peak periods.
These indicators reinforce the overall performance of the tourism sector. Saudi Arabia recorded its highest annual spending by inbound visitors, reaching approximately SR159.9 billion in 2025, representing a 4.1 percent increase compared to 2024, according to data from the Ministry of Tourism. This performance is also reflected in the balance of payments, achieving an annual surplus in the travel item estimated at around SR49.4 billion.
