Europe's largest travel operator Tui has reported a 10% drop in revenue from summer holiday bookings made by customers in the United Kingdom, as travellers grow more cautious amid the conflict involving Iran. Overall summer bookings are down 7% compared with last year, with demand shifting from eastern to western Mediterranean destinations and more customers waiting until closer to departure to secure trips.

The company is reducing the number of seats it buys from partner airlines by up to 5% over the summer, while keeping its own flight schedule unchanged. Although there are concerns about disruptions to oil and gas supplies through a key Middle Eastern shipping route, Tui's chief executive said he does not expect jet fuel shortages in the coming weeks.

Higher jet fuel prices have led some airlines to raise fares or cut capacity. Tui reported a 40 million euro impact on profits in the first quarter due to the conflict involving the United States and Israel with Iran, including repatriation and welfare costs. Despite ongoing caution among consumers, analysts said travellers appear to be delaying bookings rather than cancelling holiday plans entirely.