Business travel costs ‘unlikely to return’ to 2025 levels amid geopolitical uncertainty

Global business travel prices are expected to remain elevated through the remainder of the year before starting to moderate in 2027 in the wake of “unprecedented” energy-market disruption and rising operational costs.

While pricing pressures are expected to ease gradually next year, corporate travel costs are unlikely to return to prior levels, as many of the forces driving higher prices have become long-term features of the industry rather than short-term disruptions.

 

The projections come in a new global business travel forecast released by the Global Business Travel Association (GBTA) and TMC Altour.

 

The forecast identifies energy prices and labour costs as the two most significant forces shaping business travel pricing. 

 

The closure of the Strait of Hormuz due to the Iran war triggered the largest oil supply disruption on record, driving a sharp increase in crude oil and jet fuel prices and impacting airline operating costs worldwide. 

 

“Although fuel prices have retreated from peak levels, labour costs continue to rise across airlines, hotels, ground transportation and events and meeting providers through multi-year agreements, wage inflation and ongoing workforce shortages,” the report noted.

 

Air travel remains the most volatile category in the forecast, reflecting continued exposure to fuel costs, aircraft shortages, labour expenses and premium-cabin constraints.

 

The report said: “While travel cost growth is expected to moderate in 2027, prices are unlikely to return to 2025 levels. Structural factors including aircraft delivery delays, sustainable aviation fuel (SAF) requirements, labour shortages and geopolitical uncertainty are expected to result in a more costly travel environment.

 

The forecast also highlights “significant” regional and category differences, underscoring the need for more targeted travel planning. Rather than relying on global averages, travel buyers should evaluate costs by region, market and category, as pricing drivers vary considerably around the world.

 

On average, global airfares are projected to reach $756 this year, up 4.7% versus 2025. Economy fares are projected to rise 8.7% in 2026 to $536.

 

Premium fares (premium economy, business class and first class) are expected to rise 9.5% to $4,488, reflecting ongoing pressure on long-haul and premium travel markets.

 

Airfare increases are expected to slow in 2027 to 1.5% for overall fares, 1.1% for economy fares and 2.2% for premium.

 

North America and the EMEA region are expected to experience some of the strongest airfare increases this year, driven by capacity constraints, higher operating costs and ongoing aircraft delivery delays.

 

By contrast, Latin America is seeing capacity grow alongside demand, helping moderate airfare increases relative to other regions.

 

GBTA chief executive Suzanne Neufang said: “Business travel remains a powerful indicator of business confidence. Companies continue to invest in face-to-face connections, customer relationships and growth despite higher costs and greater complexity. 

 

“Business travel may need to weather more uncertainty through this year. In this environment, a well-managed travel programme is essential. Realizing travel’s full value will depend on managed programmes backed by strategic foresight, data and decision-making.”

 

Altour chief commercial officer Michael Boult added: “The most acute impacts of the early 2026 energy-related inflation were beginning to ease, but we are likely to see elevated fuel-related inflation for the remainder of the year and the operating environment for business travel is not returning to what it was before.

 

“For organisations, the priority now is turning volatility into a more manageable and predictable planning discipline. That means using better forecasting, stronger supplier strategies, enforcing policies and gaining real-time visibility across categories and markets to keep business travel moving.”