Ryanair’s Michael O’Leary warns European airfares could rise by up to 20% next year

Michael O’Leary says airline takeovers, bankruptcies and limited fuel hedging could drive fares sharply higher over the next 12 months

Mr O'Leary said that Ryanair and other European airlines had strong hedge positions on jet fuel for 2026. (PA Image).

European airfares will see their “biggest increase in history” next year, Ryanair chief executive Michael O’Leary said on Tuesday, with airlines largely unhedged against higher jet fuel costs.

Mr O’Leary forecast fewer seats would be available next year because of airline bankruptcies and takeovers. Combined with airlines’ limited fuel hedging, this would push fares up by as much as 20%.

“You're going to see airfares rise next year in Europe, I think by 10, 15, maybe 20%. You're going to see the biggest increase in airfares, I would say, in history in Europe for the next 12 months,” Mr O’Leary told a news conference in Brussels.

The Iran war has driven jet fuel prices sharply higher, squeezing margins for airlines without sufficient hedging in place.

Mr O’Leary said Ryanair and other European airlines had strong fuel-hedging positions for 2026. Europe’s largest airline was 80% hedged at $67 per barrel until March 2027 when the conflict began at the end of February.

However, Mr O’Leary said most European airlines had little fuel hedging in place from April 2027. Ryanair has secured just 15% of its fuel costs for next year at $85 a barrel, compared with spot rates around double that level, he said.

Boeing 737 MAX 10 certification

Mr O’Leary was in Brussels to announce that Ryanair was cutting 20 routes and more than one million seats from Belgium in its winter schedule after the country’s plans to increase its aviation tax to €7 in January, from €2 currently.

The industry veteran also said he was optimistic that US certification of the Boeing 737 MAX 10 would be completed this month, allowing Ryanair to receive 16 aircraft in early 2027.

“Boeing are hoping to have the MAX 10, the new aircraft, certified before the end of October ... We're pretty optimistic that that date will be hit,” Mr O’Leary told Reuters.

US Transportation Secretary Sean Duffy was expected to announce on Tuesday that the Federal Aviation Administration had approved the long-delayed 737 MAX 10, after a glitch with its navigation software threatened to delay certification further.

- Reuters