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Ryanair warns jet fuel price shock could stress European rivals

The airline cut some flights and trimmed its passenger target to 214m from 216m this year, citing jet fuel risks tied to the Iran war.

Reported · Written up by our desk · Energy

Ryanair warned that jet fuel prices could jump next summer, creating pressure for some European competitors, as higher oil costs are linked to the Iran war and the closure of the Strait of Hormuz, according to OilPrice.

To mitigate the risk, the Dublin-based carrier said it has secured fixed-price contracts covering 80 percent of its fuel needs for the coming year. It also opted to cut some flights to reduce exposure to market-priced fuel.

Ryanair trimmed its passenger targets for this year from 216m to 214m, while expecting summer traffic to grow by more than five percent to 145m. The company said its lower winter flight schedule is expected to soften losses by €70m to €100m.

The airline also pointed to earlier signs of fuel price volatility, saying the cost of the 20 percent of its fuel needs that were not fixed-price more than doubled at the start of this year to $150 per barrel. It reported operating costs up 11 percent to €3.8bn in the three months to June, alongside a decline in pre-tax profit.

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