International Travel Is Up 200%

Meanwhile, OPEC+ unexpectedly cuts oil production, spiking oil prices.

April 04, 2023

More travelers are choosing international destinations, according to AAA booking data. International travel is up more than 200% compared to 2022, with hotel bookings having the biggest jump, up more than 300% over last year.

AAA reports that the spike in demand is driving up airfares. Ticket prices for international trips are up more than 30%. “Travelers are making up for lost time and willing to spend more to see the world,” said Paula Twidale, senior vice president of travel at AAA.

Europe and Canada are the most popular international destinations, per AAA’s data. London tops the list, with a nearly 350% increase over last year. Rome, Paris, Dublin and Barcelona are other European hot spots. Vancouver, Toronto and Calgary are the most popular Canadian destinations.

Meanwhile, Saudi Arabia and other OPEC+ oil producers recently announced further cuts to oil output, reports Reuters. The countries will slash output by around 1.16 million barrels per day, which came as a surprise to analysts. In total, OPEC+ will cut production by 3.66 million barrels per day according to Reuters calculations, which is equal to 3.7% of global demand.

After the announcement, oil prices had their sharpest price increase in almost a year, reports CNN. Brent crude, the global benchmark, jumped 5.31% to $84.13 a barrel, while WTI, the U.S. benchmark, rose 5.48% to $79.83. The increase in oil prices could allow inflation to remain higher for longer.

“The development comes as a blow for inflation,” Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said in a note Monday. “Markets are aware that if the pressure continues, central banks will need to extend or strengthen their interest rate hiking cycles.”

Reuters notes that the oil production cuts will begin in May and last through the remainder of 2023.