Will your summer holiday cost more this year?

It’s that time of year when you might be thinking about chasing some summer sunshine - but you might also be worrying if the Middle East conflict could drive up the price of a holiday.

The US-Israel war with Iran has led to oil prices surging.

That, in turn, affects the cost of jet fuel, and airlines will often pass these higher costs on to customers.

So you could find that flights and package holidays get more expensive.

And with the situation still uncertain, you might even be asking yourself if it’s worth booking a holiday?

Or should you book now before prices go up, or wait until the situation settles down?

Well, there’s no easy answer to these questions, so let’s dig down into what’s going on.

Prices haven’t risen much…yet

According to TravelSupermarket, the average price per person for a seven-night summer holiday has gone up by just £23 since the Iran conflict began.

So it’s fair to say that prices right now are broadly the same as they were before the war.

But this blanket figure doesn’t tell the full story, as the situation changes when you look at individual destinations.

For example, a week-long holiday in Majorca has gone up from £515.62 per person to £570.26 person since the war started.

That’s an increase of £54.64 each - or £218 for a family of four.

At the same time, the average cost of a week in Ibiza has gone up only marginally, rising from £532 to £540.

Meanwhile, holidays in some popular destinations, such as Dalaman in Turkey, have actually got cheaper.

However, this might be partly because of Turkey’s proximity to the Middle East and travel companies may be lowering prices to encourage bookings.

So it might be worth taking a close look at what’s on offer, as there are still good deals to be found - at the moment, at least.

Will airlines increase prices?

The question of whether or not airlines will put up prices depends largely on how long the situation lasts.

Airlines such as Ryanair have confirmed that prices won’t change in the short-term, with chief executive Michael O’Leary saying: “We’re hedged for the next 12 months, so it won’t affect our costs.”

And according to Which?, several major holiday companies, such as Jet2holidays, Trailfinders and On the Beach, have said they won’t add extra charges to existing bookings.

That’s despite UK law allowing travel companies to increase prices by up to 8% to cover rising costs like fuel, taxes or exchange rates.

This can only happen up to 20 days before travel, and the possibility of a price increase must be clearly stated in your booking terms.

Furthermore, if prices rise by more than 8%, you can cancel for a full refund.

However, Mr O’Leary of Ryanair has warned that it may put up prices or cut capacity if oil supply issues extend into June or July.

Middle East holidays in question

An added complication is that some popular destinations, like Dubai, may be affected by changing travel advice.

The Foreign, Commonwealth, and Development Office (FCDO) currently warns against all but essential travel to the United Arab Emirates, and some airlines have cancelled flights to destinations in the area for at least the next few weeks.

So if you’re travelling anywhere in the Middle East, like Dubai or Tel Aviv, keep an eye on the travel advice, and if you already have a trip booked, contact your airline or holiday provider for advice.

Should I book a holiday then?

Prices haven’t shifted dramatically yet - and that’s good news if you want to get away this summer.

In fact, TravelSupermarket is actually encouraging people to book sooner rather than later, just in case prices go up.

“Prices won’t stay like this indefinitely,” said head of holidays and deals Chris Webber.

“And with so many destinations actually seeing prices fall, now could be a smart time to book ahead of any increases.

“Holiday companies are keen to get bookings moving, and that’s likely filtering through into some very competitive pricing right now.”

But the situation in the Middle East is extremely unpredictable.

Just a day after a two-week ceasefire was announced, there are serious questions over whether or not it will hold.

So it’s important to think about what you’d do if prices change or your travel plans are disrupted.

Looking at the terms and conditions can help you avoid unexpected costs later.

How to save money on your summer holiday bookings

Of course, the political situation in the Middle East is out of your control, but there are a few steps you can take to cut the price of a trip abroad.

Set up price alerts

Holiday and flight prices change all the time, so set up price alerts on tools such as Kayak, Skyscanner and Google Flights.

Enter where and when you want to go, and they’ll automatically let you know when prices drop or deals that might suit you become available. 

Just make sure you buy when the price is right for you.

Make the most of other people’s bookings

Many people will book a holiday but find themselves unable to go, perhaps because of sickness or because they can’t afford to go any longer.

So check out websites such as Transfer Travel where people resell their unusable travel plans at a heavily discounted price.

Equally, you can use these sites if you suddenly find yourself with a holiday you can no longer go on to recoup some of the cost.

Be flexible with your travel dates

If possible, consider travelling during off-peak periods or shoulder seasons, which are typically cheaper than peak summer months. 

For example, booking your holiday for late May or early June, or in September after the school holidays, can often result in lower prices.

Additionally, being flexible with your departure and return dates can help you find more affordable options. 

Prices can vary significantly depending on the day of the week, with midweek flights often being cheaper than weekend departures. 

Use flight comparison websites to explore different date combinations and find the most cost-effective options.

Compare prices and packages

Don't just book the first holiday package or deal you come across. 

Instead, take the time to compare prices and packages from various travel providers, so you can be sure you're getting the best value for your money. 

Use comparison websites to easily compare offers from different airlines, hotels, and tour operators.

Consider booking your flight, accommodation and activities separately, as this can sometimes be cheaper. 

But be sure to factor in any additional costs, such as transfers and meals, so you know which option offers the best overall value.

Get everything thrown in

An all-inclusive holiday might cost more upfront, but it might actually save you money in the long run, especially if you’re travelling with hungry kids.

All-inclusive holidays make it much easier to budget as flights, accommodation, transfers, meals, drinks and entertainment all come as standard. 

So you can be confident you won’t be hit with hidden extras.

Look for accommodation alternatives

Hotels can be expensive, especially during peak summer months. 

But there are alternatives available, such as: 

• rentals or apartments
• hostels
• campsites and glamping sites

Don’t rule these options out if you’re looking to keep the cost of a trip abroad as low as possible.

Book your hotel directly

Pick up the phone or email and book your hotel directly. 

Sometimes they offer discounts for guests that aren’t available to travel agents. 

Even if they don’t have any offers, they might throw in a perk such as a free upgrade, a room with a better view or a bottle of wine.

Always pay in local currency

If you’re paying for your hotel locally, you’ll be asked whether you want to pay in their currency or Sterling. 

Always go for the local currency to avoid paying extra currency conversion charges.