Europe's largest airline has warned of the risk of a "significant increase" in prices due to oil prices

Airfares are set to see a “significant increase” in 2027 if oil prices remain high through the beginning of next year, said Michael O’Leary, CEO of Ryanair, Europe’s largest airline. He was quoted by Reuters.

“If oil prices remain high next year, I think there will be a significant increase in airfares, and we’ll hope to avoid that,” the top executive noted (as quoted by CNBC). In the current quarter (July–September), Ryanair’s fares will drop slightly, but the outlook for the next two quarters (ending in December and March) is extremely uncertain, O’Leary added. Prices may rise slightly this winter, although the long-term outlook depends heavily on oil prices, he said.

CNBC requested a comment from Ryanair regarding statements made by its CEO.

The spike in oil prices has led to a sharp increase in the cost of jet fuel—a key expense for airlines, as CNBC notes. According to data from the International Air Transport Association (IATA), the price of jet fuel reached $171 per barrel for the week ending September 4. This is 90% higher than last year’s average.

On Thursday, September 10, the price of Brent crude rose to $105, while U.S. WTI crude rose to $100 per barrel. Prices are under pressure from the escalation of the conflict in the Middle East on two fronts: the war between the U.S. and Iran and the confrontation between the Yemeni Houthis and Saudi Arabia. This is severely limiting energy supplies from the Middle East.

Back in April, O'Leary warned that a wave of bankruptcies among weaker European carriers could hit the market by the end of the year, as it is becoming increasingly difficult to offset rising fuel costs.

At that time, Ryanair reported that it had hedged 80% of its summer jet fuel needs. Prices for 2027 are fixed at $67 per barrel, but for 2028, the company has secured only 15% of its needs—at a price of $85 per barrel.

This article was AI-translated and verified by a human editor