European air passengers could face significantly more expensive flights in 2027 as rising fuel prices put increasing pressure on airlines. Ryanair CEO Michael O’Leary says the company may need to raise ticket prices by as much as 20% to offset higher costs, although it remains uncertain whether such an increase will be achievable. The situation is further complicated by the conflict in the Middle East, while the airline is also considering temporarily freezing staff wages.
The era of ultra-cheap flights appears to be facing another major challenge. According to Ryanair’s financial results published on 2 November, flying across Europe could become considerably more expensive in 2027 as airlines struggle to absorb soaring fuel costs.
Speaking to Reuters, O’Leary, CEO of Europe’s largest airline by passenger numbers, said he expected double-digit fare increases across European aviation next year. Ryanair is under particular pressure. Based on current market price expectations, the company’s fuel bill could increase by around EUR 2 billion, or 33%, in the financial year ending in March 2028.
To fully offset this increase, ticket prices would need to rise by approximately 20%. However, O’Leary is not convinced the airline will actually be able to implement such a substantial increase.
“If the conflict in the Middle East is not resolved quickly, we expect aircraft fuel prices to remain high for much of 2027,” the CEO warned.
The airline is currently partly protected against rising prices. It has hedged 80% of its fuel requirements until the end of March 2027 at USD 67 per barrel. In practice, this means securing fuel at predetermined prices to protect against market fluctuations.
However, for the following 12 months, Ryanair has secured only 25% of its fuel requirements, at an average price of USD 95 per barrel. As the airline’s more favourable existing contracts expire, the impact of higher fuel prices could become increasingly difficult to avoid.
Index previously reported in April that rising jet fuel prices caused by the war in Iran could lead to significant fare increases across European aviation.
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Ryanair considers wage freeze and other cost-cutting measures despite billions in profit
The situation is particularly striking because Ryanair continues to generate substantial profits. In the July–September quarter, the airline reported a net profit of EUR 1.61 billion, although this was 6% lower than in the same period last year.
The decline was partly due to the doubling of the purchase price of fuel that had not previously been hedged. The company is therefore reviewing all its costs and has not ruled out temporarily freezing employees’ wages.
This could become possible after its multi-year pay agreements with trade unions expire in April. Ryanair is also looking to negotiate lower airport charges, reorganise staff schedules and make greater use of artificial intelligence (AI) in back-office and support functions.
Airport charges are also a point of contention in Hungary. As we previously reported, Ryanair called on the Hungarian government to reduce fees at Budapest Airport at the end of October.
Passengers, however, have not yet turned away from the airline. Although average ticket prices fell by 2% between July and September, a moderate increase has already emerged in the current quarter, while demand remains strong.
According to Ryanair Chief Financial Officer Neil Sorahan, even higher fares may not necessarily discourage people from travelling.
“An additional EUR 5 or EUR 10 on a Ryanair ticket does not necessarily reduce people’s willingness to travel,” he said.
The airline also noted that passengers are increasingly booking flights closer to their departure dates, meaning that booking trends ahead of Christmas could prove particularly important.
