2026 has been a tough year. What started out just like any year since 2021 - insufficient production, expensive engines, crazy residual aircraft values, and a shift to the premium passenger - has shifted to questions of oversupply, too many spare engines, questionable residual values, and a shift to the premium passenger (ok, that last one hasn’t changed).

But 2026 won’t be known for any of those things. The year will be remembered for one singular metric - the price of fuel.

But it’s not the price of fuel we want to talk about today (Brent crude has found stability at $110 a barrel, and Jet A is $4.73 / gallon. Last year, jet fuel was $2.55 / gallon). Today, we want to talk about aviation growth in 2026 - or the lack thereof.

We all know what happened in 2026. Iran, Hormuz, drones and missiles over airports… yadda yadda… Middle East traffic down 10%.

But traffic growth is substantially down in other regions, as well. Europe is growing at just over half the rate it did last year. North America is growing at one-third the rate it did last year. Southeast Asia? The region grew 5.9% in 2025, now 1.7% in 2026.

Global aviation growth has been slashed by two-thirds, down from 4.7% in 2025 to only 1.5% in 2026. Even excluding the Middle East, growth was cut in half from 4.6% in 2025 to 2.3% in 2026.

But up is still up - this is true. The global aviation market did not shrink in 2026. 2027 will likely bring higher numbers, if for no other reason than the Middle East will likely not see the same safety issues directed at commercial aviation as it did in 2026 (one can hope, anyway).

But consider that global GDP grew at 3.1% in 2026. Aviation grew at half the rate. In 2025? Global GDP grew 3.5% while aviation outpaced it at 4.7%.

What we’re trying to tell you is that things just changed. At $4.73 a gallon, the narrowbody shortage we’ve gotten so used to since 2022 is over. But fuel isn’t the culprit behind any coming oversupply; it just accelerated it. Our expectations have long been the end of the shortage around 2028 - with fuel at $2.30 / gallon. That just got pulled forward two years, but the dynamic is the same. The problem we’ve been talking about for months is that we can no longer assume traditional growth rates.

Now, let’s consider what this could mean for the post-COVID anomalies that have since been inappropriately converted into assumptions: residual values will only go up; the industry will not adjust to chronically low production rates; we will revert to pre-COVID growth rates and zero percent interest rates.

And so, the world exits the supply chain challenges, if for a completely different reason than expected. Rather than resolving the supply chain to allow growth for the industry, the industry just raised its cost basis and slowed growth to adapt to the broken supply chain.

And yet, growth continues, just at slower rates. Fuel prices could drop again (though many have expected that since February 28). That could drive capacity back into the system. However, before you get too excited, consider that the International Maritime Organization has logged 34 ship attacks in and around the Strait of Hormuz in October 2026 alone.

But whether accelerated by high fuel prices or not, the new normal is coming. This isn’t catastrophic. It’s just… well… normal. Growth rates lower than last decade - a simple and seemingly innocuous reality. Aviation’s problem is it got a bit too used to the anomaly.

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