London (AFP) – Irish airline Ryanair announced on Monday that it was considering temporary salary freezes and increased use of artificial intelligence to reduce its costs in the face of soaring fuel costs linked to the war in the Middle East, and anticipated sharp increases in air fares in 2027.

Published on: 02/11/2026 - 15:43

“Unless there is a rapid resolution to the conflict in the Middle East, we expect kerosene prices to remain high for much of 2027,” explains the group's managing director, Michael O'Leary, quoted in the press release.

For the current financial year, which ends on March 31, Ryanair is covered for 80% of its fuel needs, at a price of around $67 per barrel, well below current prices.

But for 2027-2028, only 25% of its needs are at this stage covered, at a higher price of around $95 per barrel. Based on current forward prices, Ryanair anticipates an increase of around two billion euros in its fuel bill.

“To deal with this, we are reviewing all the costs of the group's airlines,” continues Mr. O'Leary.

“Price increases”

Among the avenues envisaged for the next financial year are “an increased use of AI” to improve the productivity of operations and administrative services, but also the slowing down of certain recruitments, as well as temporary salary freezes during the renewal of collective agreements.

“We have a multi-year salary agreement in place, which covers next year”, just like “several unions across Europe”, reacted Oliver Richardson, an official of the Unite union, in the United Kingdom, the group's second country in number of employees behind Spain.

“Our salary agreement was neither linked nor conditioned on the performance of the company,” he added, saying he expected “it to be respected”.

Fuel hedging for the current financial year did not prevent net profit from falling in the second quarter, ended at the end of September, due to the increase in fuel costs and the fall in ticket prices.

Over these three months, it stood at 1.61 billion euros, down 6% year-on-year, despite a 4% increase in turnover, to 5.7 billion euros.

During the half-year, the conflict in the Middle East "led to consumer hesitation and later bookings", weighing on prices, explains Mr. O'Leary.

But in 2027, more expensive fuel should on the contrary push European companies "to double-digit price increases", he added in a video accompanying the results.

“No visibility”

“Many airlines have been able to weather the surge in oil prices this year thanks to their forward hedges, having priced much of their fuel purchases in advance before the Iran war,” says Dan Coatsworth, head of markets at AJ Bell.

“These covers will soon expire, which will expose the airline sector to a sharp increase in its costs,” he adds. “Travelers should prepare for a sharp increase in airfare prices.”

Ryanair plans to transport 214 million passengers in the current financial year, an increase of 3%, then more than 220 million in 2027-2028.

The company nevertheless judges that it is too early to give an annual net profit forecast, claiming to have "no visibility for the fourth quarter".

The result for the financial year remains particularly exposed to an escalation of conflicts in the Middle East and Ukraine, unhedged fuel prices, macroeconomic shocks and disruptions in European air traffic control, warns the group.

© 2026 AFP

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