Ryanair bought most of its fuel at about $67 a barrel. The rest has roughly doubled in price. That gap is why Europe’s biggest airline by passengers is weighing a Ryanair pay freeze, announced alongside its half-year results on Monday.
According to chief executive Michael O’Leary, Ryanair’s fuel costs will be higher by approximately €2bn in the next fiscal year beginning April 1, 2027. Increased fares, according to the CEO, will not be enough to compensate for that.
The company is looking into all its expenses. The measures may include a temporary halt on salary increases in cases when there are no collective bargaining agreements that guarantee one, reducing the number of cabin crew on each plane and using artificial intelligence technology in back-office operations. Nothing has been finalised yet.
The company’s trade union, Unite, had not commented at the time of publication of some reports.
Profit before tax for the period between April 1 and September 30 decreased 15% to €2.15bn from €2.54bn in the corresponding period a year ago. Revenue increased by 3%, while average ticket price went down by 4% to €57.50.
About 80% of the airline’s fuel has been hedged, which means purchased at fixed prices until March 2027. Fuel costs without hedging have almost doubled. The war in Iran has led to reduced supplies of fuel from the Gulf region.
Will European airfares rise in 2027?
Almost certainly, according to O’Leary. He expects airlines to push fares up by as much as 20% next year as hedges expire. He calls it “a very significant cost cliff” for the industry. Ryanair also expects rivals to cut capacity, which would support higher prices.
Ryanair says jet fuel will stay elevated well into 2027 unless the conflict is resolved quickly. It’s too early for full-year profit guidance.
