‘BEST hedged airline in Europe’ – Michael O’Leary tells Ryanair AGM

Additional 15pc hedged at $85 a barrel for 2028 financial year
Average fares may rise slightly this winter following mild upturn since July
Winter schedule cuts reduce fiscal 2027 traffic target to 214 m passengers
Oil prices rose above $100 a barrel during the week
Ryanair has hedged 80pc of oil costs at $67 a barrel until March 2027.

Ryanair group chief executive Michael O’Leary has stated that his airline is better hedged than almost any other airline in Europe with regard to oil prices, with 80pc of oil costs hedged at $67 a barrel until March 2027. The airline has also hedged a further 15pc of its oil at $85 a barrel for the 2028 financial year. O’Leary confirmed that Ryanair stopped hedging as oil prices rose in recent weeks.

The Ryanair CEO nudged his airline’s outlook for average fares higher, stating they may rise slightly this winter following a mild upturn since July, although the outlook depended heavily on oil prices. The airline’s average fares fell month-on-month from February to July, contributing to a slump in profits in its last financial quarter as high oil prices raised costs. O’Leary stated that fares had since risen by a very low-single digit amount year-on-year, with a slight upturn in the last month.

For the winter season from October to March, O’Leary stated in July that fares were set to fall by low to mid-single digits in percentage terms, but that pricing might move to flat or even slightly higher if rivals reacted to oil costs by reducing capacity. He stated that the flat-to-slightly higher scenario appeared more likely. Ryanair cut flights from its winter schedule earlier this month to reduce losses and its exposure to unhedged fuel, resulting in a reduction of its fiscal 2027 traffic target to 214 m passengers from 216 m.

Mainstream media coverage of the event focused on O’Leary’s reference to other airilnes “raping” the consumer. Asked whether the thought it was offensive to victims of sexual violence, he said that was how he referred to high cost competitors.

Michael O’Leary, Ryanair Group Chief Executive, shared: “We think oil prices will continue to be bumpy between now and the end of the year, so there is plenty of time to extend our hedges between now and Christmas if needed. It is unlikely oil prices will stay up at such high prices through the winter, but if they do there will be more airline failures. A lot depends on what happens to oil prices for the next five or six months but I would be reasonably hopeful that pricing will be flat-ish, maybe even slightly positive in the second half of the year.”