One of the UK’s largest tour operators has cut the number of holidays on sale to Malta by 19 per cent, citing lack of buyers, the credit crunch, sterling weakness against the euro and oil driven inflation as the reasons for doing so.

Meanwhile, the Daily Mail has said that the average two-week holiday for a family of four has increased by up to £400 compared with last year adding that while prices are higher, choices are more limited as travel firms slash the number of breaks on offer.

Thomas Cook cut the number of holidays to mainland Spain by more than a quarter, while trips to the Balearic Islands are down by a fifth. Other destinations which have seen big reductions include Portugal (down 20 per cent), Malta (down 19 per cent) and Italy (down 17 per cent). Thomas Cook said average prices had risen by 14 per cent in the past three months. The group has cut the number of holidays on offer by a similar percentage compared with last year.

Thomas Cook’s chief executive Manny Fontenla-Novoa said: “People are cutting back on their travel expenditure. This is all driven by the fact that costs are going up. Oil is soaring. It may have dropped back to $114 a barrel but it was only $60 last year.”

He also said that holidaymakers are hit by the weakness of the pound against the euro. “So not only do the holiday costs increase, so does the cost of going out for a meal. The average price of a week-long holiday for an adult has risen by up to £70 on last year,” he said.