I've often seen 'read the air' (literal translation) or 'read between the lines' but is there a better rendition of this concept in English? Or does it just not exist?
I don't think "read between the lines" accurately conveys the intended meaning of
There is no one-to-one match in English for "reading the air", but the concept definitely exists. Never mistake not having a set phrase for not grasping a reality. People talk about that kind of thing all the time, it's just that they will have to construct descriptions from words and grammar suited to the situation, not easily refer to a preset.
If someone had no ability to read the air, I would simply say that person was "oblivious". If someone did have the ability to read the air, I would say that person was "intuitive", "perceptive", or "sensitive".
Sensitive to what? The "atmosphere", the "mood", or the "situation". Or, to be even more ethereal, I might just use "it" to encompass the things I feel I can't encompass, like when we say, "don't you get it?".
So, for situations of not successfully reading the air, I might say, "That guy is oblivious to the situation". For successful reads, "that guy really gets it." If I wanted to push someone, I might say, "dude, can't you see what's going on here?"
Other related phrases that might give you a sense of how English applies in similar situations are (note these are just my own constructions, easily understood but not conventional):
In short, to describe reading the air in English, you'll have to successfully read the air to the point where you can apply the most suitable English phrasing.
As a last note, I think "read the air" has a high potential for transfer into English. I believe that if one person told another to "read the air", and even if they had no knowledge of the Japanese phrase, the meaning would very likely be understood. It sounds a little poetic, but well within the bounds of everyday usability.
In fact, I think I'm going to start using it in English, as I feel like it closes a lexical gap. We have the idea, but not the phrase. So if you ever hear someone in English refer to "reading the air" as a part of their discourse, you'll know where it started.
In this particular case 空気 is similar to 雰囲気.
So 雰囲気を読む or 場の雰囲気を読む has a pretty similar meaning to 空気を読む.
I'd translate 空気 as the "mood" or "feel", in this particular case.