Ryanair is considering a temporary wage freeze for staff and has warned that airfares will be “materially higher” next summer because of rising fuel costs linked to the war in Iran. The airline said it expects fuel prices to remain high “well into 2027” unless there is a “swift resolution” to the conflict.
Ryanair said its fuel bill is expected to rise by $2.24 billion in the short term. CEO Michael O’Leary said airfares would have to increase by double digits to help cover the additional costs. However, that may not be enough, and the airline is considering “temporary pay freezes.”
The airline said its pre-tax profits fell 16% in the six months to the end of September, largely because of higher fuel costs, which rose by 15%.
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Ryanair said that although 80% of its fuel bill had been “hedged” — effectively bought in advance at fixed prices — the cost of the remainder had risen. O’Leary said Ryanair would “need a 20% fare increase” to cover jet fuel costs, based on forecasts.
“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.”
Aviation fuel prices have risen this year amid the U.S.-Israel war with Iran, which has sharply reduced supplies of refined petroleum products from the Gulf and intensified competition for supplies from other regions.
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Ryanair also said it was considering a pay freeze as “maturing labor agreements” — multi-year wage deals with unions — come to an end. The policy could be introduced from April 2027. The airline also plans to increase its use of artificial intelligence in back-office and support functions.
Ryanair has already cut some winter flights and said Monday that further reductions could follow. The airline said the trend was affecting the wider aviation industry, particularly short-haul carriers.
“We believe those cuts will continue into the summer of 2027. Over the medium term, we expect short-haul capacity will remain constrained out to the early 2030s,” O’Leary said.
Earlier this year, O’Leary predicted that travelers across Europe would face the biggest increase in airfares “in history” in 2027. He made the comments at a news conference in Brussels.