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CEO Michael O'Leary told Euronews that airfares would rise significantly in 2027 because of higher fuel costs. He also criticised European environmental taxes for adding to airlines’ costs.
The chief of Europe’s biggest budget airline expects airfares to go up by as much as 20% in 2027 across Europe, as airlines are hit by higher jet fuel costs while the Iran war continues to drive up oil prices.
According to O'Leary, airlines are largely unhedged against higher jet fuel prices from April 2027.
Jet fuel prices in Europe and the CIS averaged $207.61 a barrel in the week ending 16 October, up almost 128% from a year earlier, according to the International Air Transport Association’s (IATA) monitor.
Many European airlines, including Ryanair, had strong hedge positions through 2026, O’Leary said, but their protection is much more limited from April 2027. He told Euronews that Ryanair had locked in fuel at about $67 a barrel this year, but he added, “our oil price will double” next year.
Speaking at a press conference in Brussels on Tuesday 20 October, he said: "You're going to see airfares rise next year in Europe, I think by 10, 15, maybe 20%. You're going to see the biggest increase in airfares, I would say, in history in Europe for the next 12 months."
“We’re 85% unhedged next year, and most of the other European airlines are in a similar position,” he said.
Higher jet fuel prices have squeezed margins for airlines without hedging protection.
Prices of crude oil and refined products, including jet fuel, rose rapidly following the outbreak of the Iran war and the effective closure of the Strait of Hormuz. Brent crude futures, the international benchmark, traded at $109.86 on Wednesday near a five-month high.
According to O'Leary, on top of the higher fuel costs, there will be fewer seats available in 2027 as a result of bankruptcies and takeovers in the European aviation market.
O'Leary was in Brussels to announce a major cut to the company’s operations in Belgium ahead of an increase in the country’s aviation tax from €2 to €7 in January 2027.
Ryanair is cutting 20 routes and 1.1 million seats from its Belgian winter schedule, blaming the tax rise. The airline said it was moving six aircraft to lower-cost European markets.