DUBLIN — Irish no-frills airline Ryanair said on Monday it would launch a cost-cutting drive and raise fares next year to help offset soaring jet fuel prices driven by the Middle East war. The airline said its fuel bill is expected to rise by €2.0 billion ($2.24 billion) — yaani roughly ₹20,000 crore — in its next financial year, which could prompt measures such as temporary pay freezes, lower cabin-crew ratios and greater use of artificial intelligence in back-office work.

Source: AFP

The warning came as Ryanair reported that pre-tax profit fell 16% to €2.4 billion in the six months to the end of September, largely because fuel costs rose 15%. Passenger traffic grew 5%, but average fares fell 2% as the war made travellers hesitant and pushed bookings later.

Source: AFP

'Double-digit fare increases across Europe'

'Unless there is a swift resolution of the Middle East conflict, we expect jet-fuel prices to remain elevated well into 2027,' chief executive Michael O'Leary said in the earnings statement. Fares would have to rise by double digits to help cover the costs. 'I'm not sure we'll get to 20%,' he said. 'But we're certainly looking at double-digit fare increases across Europe from all airlines in 2027.'

Source: AFP

To close the gap, Ryanair is reviewing everything, from airport and handling costs to crewing levels. 'We are looking at everything, so airport costs, handling costs, and up for debate now is probably a pay freeze next April for pilots, cabin crew and the management team,' O'Leary told Bloomberg Television. He said there is no risk of job cuts because the airline still plans to grow by about 3% next year. A freeze could begin as multi-year pay deals with unions run out in April 2027.

Source: Bloomberg via BusinessMirror

Ryanair is shielded for now: about 80% of its fuel for the year to March 2027 was bought in advance at around $67 a barrel. But only about a quarter of the following year's needs are hedged so far, at around $95 a barrel, while fuel bought without such protection has cost about $130 a barrel. The Unite union, which represents Ryanair staff, said national officer Oliver Richardson had not been told of any pay-freeze proposals.

Source: BBC News

€2 billionExtra fuel bill expected next year
$67 a barrelPrice 80% of fuel is hedged at, to Mar 2027
$130 a barrelCost of unhedged fuel, about
16%Fall in half-year pre-tax profit
What it means for travellers

Ryanair carries more passengers than any other airline in Europe, and its fares set the floor for the whole market. If its warning holds, budget flights across Europe — including the short hops many Punjabi families in the UK, Ireland and the continent rely on — will cost noticeably more next summer, whatever happens in the Gulf.