Ryanair's O'Leary expects European fares to rise 10-20% in 2027

Ryanair chief executive Michael O'Leary has predicted that European air fares could rise by 10% to 20% next year as the airline's cheaper fuel hedges expire, according to AirlineGeeks. The warning accompanied the airline's half-year results, published on 2 November 2026, in which Ryanair said it is weighing temporary pay freezes among other cost-saving measures.

What O'Leary said

Speaking to CNBC on Monday, O'Leary said customers had been insulated for the past 12 months but that the hedges were rolling off. AirlineGeeks quotes him as saying jet fuel stood at $170 a barrel and that there was still no resolution in the Middle East. He described the situation as a "very significant cost cliff" for next year.

Results and fuel position

AeroTime reports that profit after tax for the first six months of the financial year, which began in April 2026, fell 15% to €2.15 billion from €2.44 billion, even though passenger numbers rose 6%. Revenue rose 3% to €10.08 billion, while the average fare paid dropped 4%.

According to AeroTime, Ryanair's fuel for the current financial year is 80% hedged at $67 a barrel, while the following year is 25% covered at about $95. The airline said that unless the Middle East conflict is resolved swiftly, it expects jet fuel prices to stay elevated well into 2027. It estimates a roughly €2 billion increase in its fuel bill for the financial year to March 2028. Short-haul fares will rise "materially", it said, but probably not enough to offset that.

Cost-cutting options

Ryanair said it is reviewing costs, including airport negotiations as Boeing MAX 10 aircraft begin arriving from spring 2027. AeroTime says other areas include maturing labour agreements, which may require temporary pay freezes, lower crewing ratios and greater use of AI. AirlineGeeks notes that the airline did not say how long a freeze might last or how staffing would change. The group has more than 27,000 employees.

The airline also said full-year profit guidance is too early to give, with no visibility on the final quarter, and that results remain sensitive to conflict escalation, its 20% unhedged fuel and European air traffic control disruption.

Wider industry pressure

AirlineGeeks reports that fuel prices have led several European airlines to cut capacity this autumn and winter and retire older aircraft. It says the pressure pushed Lufthansa to accelerate the closure of Lufthansa CityLine and made easyJet open to a takeover by Apollo Global Management valued at about $7.7 billion.

Travel Daily Media adds that Hopper forecast in September that this year's holiday travel would be the most expensive in a decade. It cites a US broadcast report of average domestic Thanksgiving fares of about $400 return, up 31%, and says last-minute fare drops have largely vanished and some low-cost carriers now charge for seat changes.

What this means for travellers

• Fares across Europe are expected to rise in 2027, with O'Leary pointing to 10-20%, though this is his prediction rather than a published fare change.
• Booking winter and Christmas trips early looks sensible, given reports that late fare drops have become rare.
• Check the cost of seat changes and other extras on low-cost carriers before booking.
• Ryanair has not said whether pay freezes or crewing changes would affect service. Any impact on schedules is not yet known.

Compare the carriers in our Ryanair vs easyJet guide.

Sources: AirlineGeeks, AeroTime, Travel Daily Media.