EXPERTS and small business owners fear the ongoing Iran war will make holidaymakers think twice about a UK getaway in an impending “hidden crisis” as fuel prices rise.
Rising tensions in the Middle East and the knock-on impact on fuel prices are starting to ripple into how Brits think about travel.
Average petrol prices in the UK are now 144.16p per litre. This is the highest price since July 2024, the latest data shows. It has risen over 12p per litre since the start of the war in Iran on 28 February.
While much of the focus remains on household bills, there are growing signs of a “hidden crisis” for UK tourism, as people begin to question whether they can afford to travel at all.
This is creating a knock-on effect for businesses, with more conversations around cancellations, flexibility and the real cost of getting away, even for domestic breaks.
We’re expecting more guests to postpone or cancel
Kate Allen, Owner at Kingsbridge-based Finest Stays, said she fears that Brits will stop booking holidays over fears of rising fuel prices and inflation.
She added: “For now, we’re not seeing a slowdown. Bookings are up around 10% on this time last year, with more guests opting to stay in the UK rather than travel further afield to places like Dubai.
“The Great British holiday is very much in favour, as we’re a nation that prioritises getting away, and domestic breaks are benefiting from that shift. That said, there’s a nervous undercurrent. Fuel costs feel like a slow leak, pressure building rather than bursting.
“We’re expecting more guests to postpone or cancel, and that’s where it gets tricky. Terms and conditions may cover it, but it doesn’t make refund conversations any easier when the wider impact on businesses and homeowners isn’t fully understood.”
Nouran Moustafa, Practice Principal & IFA at Roxton Wealth, said holidaymakers will think twice.
She added: “Yes, I think rising petrol costs are making people think twice, because travel is one of the first things households start questioning when everyday essentials become more expensive. Britain is especially exposed to this kind of energy shock, and the Bank of England has already held rates partly because of the inflation risk coming through oil and gas.
“That means this is not just about the cost of filling up, it is about confidence, budgeting and whether people feel they can justify a break at all. What I find more troubling is the bigger picture. It is a shame that in one of the wealthiest countries in the world, working people can feel pushed into rethinking basic quality-of-life decisions over a few extra pounds at the pump.
“UK breaks can still offer value, but once you add fuel, food and accommodation, they do not always feel as “cheap” as people assume. So yes, rising travel costs absolutely can make people postpone or cancel trips.”
UK breaks can still offer value
Ben Perks, Managing Director at Stourbridge-based Orchard Financial Advisers, said he believes it is overseas holidays that will be cut back on.
He added: “The UK Getaway could see a resurgence. With the conflict in the Middle East, long haul holidays will be less desirable. Dubai airport is a stop off point for so many destinations.
“Families will also think twice about destinations like Cyprus. As costs in the UK rise, the lavish holidays may be put on hold until next year, but people need a break from work and they may choose to do that within the UK.”
Rohit Parmar-Mistry, Founder at Burton-on-Trent-based Pattrn Data, said UK breaks can get expensive.
He added: “Fuel matters, but it is not the main reason UK getaways feel expensive. The real sticker shock is accommodation. Holiday lets and staycation hotspots have imported airline style pricing: peak weeks, cleaning fees, minimum stays, and a shortage of decent stock.
“By the time you add parking, attractions and food, the car journey is often the smallest variable. The headline price is only the start, school holiday premiums and add-ons can turn a short break into a serious bill.
“If we want domestic travel to compete, the fix is transparency and value, not hand wringing about petrol. Show the total trip cost up front, stop drip fees, and make off-peak deals meaningful. Otherwise more people will conclude that a cheap flight looks like better value than a UK weekend.”
Photo by Possessed Photography on Unsplash.
