Ryanair's O'Leary says 'insanely higher' jet fuel cost could remain into 2028 (updated)

International Consolidated Airlines

08/10/2026 09:58

Jet fuel costs running about 50% above pre-war levels
Costs likely to stay elevated for 12 to 18 months, O'Leary says
O'Leary says he expects airlines to raise fares in coming months
Spohr: robust pilot mental health checks cannot prevent all incidents
Updates with more context on jet fuel, recasts
By Julia Payne and Joanna Plucinska
BRUSSELS/LONDON, Oct 8 (Reuters) - European airlines could face more than another year of elevated fuel costs and higher fares due to the Iran war, Ryanair RYA.I Group CEO Michael O'Leary said on Thursday, in the first warning by an executive that the knock-on effect could spill into 2028.
     The Iran war has driven jet fuel prices sharply higher this year, squeezing airline margins despite widespread fuel hedging. 
     Jet fuel is currently about 50% more expensive than it was pre-war, and is likely to remain at those levels for the next 12 to 18 months, O'Leary told reporters at an Airlines for Europe (A4E) press conference.
     "We are all facing an enormous cost challenge next year," he said, though he said he did not expect supplies to run out any time soon.
Analysts have warned that Europe could face a jet fuel supply shortage into the fourth quarter. 
"There is no question over availability of jet fuel in Europe this winter, or frankly into next summer," he added. 

PRICIER FLYING
O'Leary said he expects fare increases to continue in the months to come, particularly as many carriers are substantially less hedged on jet fuel costs moving into 2027. 
He previously said ticket prices could be up to 20% higher next summer as a result of rising costs. 
     "The airlines cannot survive unless they pass on these insanely higher fuel costs in the form of higher offers, and the customers will have to pay," O'Leary told journalists on the sidelines of the press conference, adding later that the situation was already a "full-blown crisis".
     Other conference participants included the CEOs of Air France-KLM AIRF.PA, Lufthansa LHAG.DE, easyJet EZJ.L and British Airways owner IAG ICAG.L. Many of the carriers present have already begun to pass on the cost of fuel to passengers through higher fares. 

 (Reporting by Julia Payne and Joanna Plucinska; Editing by Joe Bavier and Elaine Hardcastle)
 ((joanna.plucinska@thomsonreuters.com, +44 7721 669853))