Ryanair hedging – Ryanair’s chief financial officer says the Iran war’s impact on jet-fuel costs could push already-struggling carriers to bankruptcy during winter. The airline says its heavy fuel hedging and its view of improved supply conditions leave it confident about opera
Jet fuel has turned into a make-or-break expense for airlines, and Ryanair’s leadership is warning that the damage may not be limited to one casualty.
Neil Sorahan, Ryanair’s chief financial officer, said some “weaker carriers who were already struggling before the war possibly go to the wall in the winter,” speaking Monday.
The pressure traces back to the Iran war, which began in late February. Since then, Brent crude oil has risen more than 50% to more than $110 a barrel. Jet fuel prices climbed to almost $200 a barrel, before easing to about $163 a barrel, based on International Air Transport Association figures.
Sorahan’s warning lands after Spirit Airlines became the most visible victim of the fuel spike. Spirit had already filed for bankruptcy restructuring last August, but it stopped flying earlier this month, pointing to rising fuel costs.
Fuel is typically the second-biggest expenditure for an airline, after labor, leaving carriers exposed when prices surge.
Even so, Ryanair says it has built protection into its cost structure. During a Monday earnings call, CEO Michael O’Leary said 80% of its fuel is hedged at $67 per barrel. He added: “We do not expect to be cutting flights or schedules because of higher oil prices.”
Sorahan also drew a line between early uncertainty and his current view of supply. He said Ryanair “probably had some concern around oil supply” a couple of months ago, but that it is “increasingly confident” there won’t be issues this summer.
Europe’s exposure is part of the reason for that confidence.. Sorahan said Europe is less dependent on oil imports through the Strait of Hormuz. with more oil coming from the US. Venezuela. and Brazil.. “That said. I think prices will remain higher for longer. which puts Ryanair in a particularly strong position. given our strong fuel hedging.”
As a budget airline, Ryanair’s strategy is to keep ticket prices low, a goal it ties directly to hedging. Sorahan also acknowledged that planning still includes worst-case scenarios: “Do we have plans for some kind of Armageddon situation? Of course, we do, but I don’t see that coming to pass.”
He said “as things stand” the airline is operating a full schedule this summer and plans to run a full schedule into the winter period.
On Monday, Ryanair reported that it carried 208 million passengers through the 2026 financial year, and that profits after tax rose 40% to 2.26 billion euros ($2.6 billion).
The pattern is stark and consistent across the numbers: the Iran-war start in late February pushed Brent above $110 and jet fuel toward almost $200 a barrel. while Ryanair’s response relies on the fact that 80% of its fuel is hedged at $67—allowing it to forecast full schedules even as Sorahan warned weaker. already-stressed carriers could fail in the winter if fuel costs stay high for longer.
For now, Ryanair is positioning its hedging and its view of supply changes as a shield, while its CFO is still leaving room for fallout elsewhere—especially among airlines that didn’t hedge enough before the fuel shock hit.
Ryanair Spirit Airlines jet fuel Brent crude Iran war fuel hedging bankruptcy airline industry passengers profits
So basically Ryanair saying Iran ruins everyone’s winter, cool.
I read where Spirit shut down and thought it was just mismanagement. But jet fuel at almost $200?? That’s wild. People act like it’s nothing until flights stop.
Wait, if they hedge at $67 then why does it even matter? Like if they’re protected then this “could sink weaker airlines” thing is just fear mongering. Also $110 oil doesn’t sound like $200 jet fuel? numbers feel weird.
Winter bankruptcy talk always scares me because it’s always “weaker carriers” until it’s your flight getting canceled. They say 80% hedged so Ryanair will be fine… but does that mean tickets will get cheaper or they’ll just raise fees anyway? I swear jet fuel prices go up and airlines act like it’s a surprise every time.