Ryanair has indicated it will not increase average summer fares year-on-year, despite a sharp rise in jet fuel prices triggered by the ongoing Middle East conflict. The budget airline cited consumer uncertainty leading to later booking patterns, suggesting holidaymakers can still secure bargains rather than airlines passing on higher costs.
Pricing Outlook Softens
Ryanair reported that air fares have weakened in recent weeks, with average prices expected to be lower in the three months to the end of June. The airline also revised its outlook for summer fares, now anticipating pricing to be "broadly flat" between July and September, having previously forecast a low single-digit increase over the peak season.
Chief executive Michael O'Leary commented: "Pricing in recent weeks has eased somewhat in response to economic uncertainty caused by higher oil prices, the fear of fuel shortages and the risk of inflation adversely impacting consumer spending."
Fuel Costs and Supply
While Ryanair has secured pricing for 80% of its jet fuel needs, the cost of the remaining 20% has surged due to the Middle East conflict. However, the threat of fuel shortages is receding as suppliers adapt to the prolonged closure of the Strait of Hormuz. Finance boss Neil Sorahan stated that the airline is now "increasingly confident" there will be no disruption to jet fuel supplies even after the summer, as refiners increase volumes and seek alternatives to Gulf oil supplies.
Mr O'Leary noted that European airlines are sourcing jet fuel from alternative countries to overcome the supply shock caused by Iran's blockade of the Strait of Hormuz. He added: "The conflict in the Middle East has created economic uncertainty and we still don't know when the Strait of Hormuz will reopen. Despite this, Europe remains relatively well supplied with jet-fuel, with significant volumes sourced from west Africa, the Americas and Norway."
Financial Performance
Ryanair posted a 40% rise in profits to £1.96 billion for the year to March 31, slightly better than expected. The group said it was "far too early" to give an outlook for the new financial year given the uncertainty over demand and fuel prices. Bookings are increasingly being made at the last minute, though demand remains "robust". Ryanair expects to fly 4% more passengers over the year to March 2027, reaching 216 million, matching the 4% growth seen in 2025/26.
The airline has "almost concluded" negotiations on an extension to Mr O'Leary's contract to 2032, including a 10 million share option agreement subject to share-price and profit targets. An earlier share option scheme is set to earn O'Leary as much as £87 million.
