Ryanair predicts Europe’s biggest-ever air fare rise, up to 20% next year

Ryanair built its business on teaching Europeans that a flight could cost less than dinner. Its chief executive, Michael O’Leary, now says the price of that habit is about to jump: ticket prices could rise by as much as a fifth, in what he called “the biggest increase in airfares, I would say, in history in Europe.”

The cause sits in the fuel tank. Ryanair has locked in the price of only a small share of the jet fuel it will burn once its current cover runs out, and O’Leary says most European rivals are just as exposed. When airlines cannot fix what they pay for fuel, the difference lands on the ticket, and the people booking a beach week or a family visit are the ones who will cover it.

Why next year’s fuel is the problem

“We’re 85 per cent unhedged next year, and most of the other European airlines are in a similar position,” O’Leary told reporters in Brussels. Hedging, buying fuel in advance at a fixed price, is what has kept Ryanair’s current financial year under control: the airline covered about 80% of its needs at roughly $67 a barrel, against a jet fuel price the company has put at around $140. O’Leary chose not to hedge aggressively for next year because he considers prices too high, and admitted “we may call that wrong.”

Ryanair’s average fare is about €50, so a 20% rise would add around €10 a seat, or about €80 for a family of four flying out and back. O’Leary doubts even that will be enough. “The question is, will that increase in airfares be enough to cover the dramatically higher oil bills? I don’t think it will be,” he said. Ryanair says it will not add a separate fuel surcharge, while O’Leary told Reuters that “the legacy guys certainly will next summer.”

Who pays, and who drops out

Passengers will feel it first through fewer seats. Ryanair has already trimmed its passenger target for the financial year from 216 million to 214 million, thinning a winter schedule it describes as unprofitable, and it is shrinking in France and Belgium, where it blames higher aviation taxes. The pressure falls hardest on smaller carriers: airBaltic and Spain’s Volotea are restructuring, Lufthansa has beaten Air France-KLM to a stake in Portugal’s TAP, and Apollo Global Management is preparing a framework to take over EasyJet. The warning covers European short-haul flying; long-haul fares depend on other carriers’ hedging.

O’Leary also has a reason to talk prices up. At a London briefing he said he hoped jet fuel would rise faster “because that will accelerate the extent to which other airlines will fail,” and Ryanair stands to pick up the passengers they leave behind. The 20% figure is a ceiling that assumes fuel stays near current levels; his earlier range was 10% to 20%. Ryanair itself cut fares 6% year on year in the first quarter of its financial year to fill planes, and investors doubt the squeeze will spare it: its shares fell as much as 2.2% in Dublin and are down about 25% this year, on course for the worst annual return since 2018.

What comes next

O’Leary spoke at a press conference in Brussels on Tuesday, October 20, as Brent crude traded above $110 a barrel. Jet fuel costs have climbed since the war involving Iran began in late February. Ryanair has said it aims to raise its hedging for the year that includes summer 2027, currently around 15%, to 30% to 40% by its half-year results in November, and it expects its first Boeing 737 Max 10 aircraft in January, with about 16 more through April.

At the London briefing, O’Leary’s advice to holidaymakers was short: “If you’re planning your holidays next year, next summer, I’d be booking them today.”

Tags: jet fuel, air fares, European aviation, low-cost airlines, Michael O'Leary, Ryanair