Irish budget airline Ryanair has announced a substantial slump in its quarterly profits, with figures dropping by more than a third. The airline reported a 34 per cent decrease in after-tax profits, reaching £457 million for the three months concluding in June 2026. This significant downturn is primarily attributed to a dramatic increase in jet fuel prices, which more than doubled during the period, alongside a strategic decision to cut average fares.
Jet fuel prices soared to $150 (£111) a barrel over the quarter, a direct consequence of the ongoing conflict in Iran disrupting global oil and gas supplies. The crucial Strait of Hormuz, a vital shipping lane for oil, has been particularly affected, leading to supply concerns. Ryanair’s chief executive, Michael O’Leary, explained that the airline proactively lowered fares by 6 per cent to mitigate ‘consumer hesitancy, concerns about EU jet-fuel shortages, economic uncertainty and later bookings’ stemming from the Middle East conflict.
Despite these considerable headwinds, Ryanair did experience a 6 per cent rise in passenger numbers, reaching 61.3 million, and a modest 1 per cent increase in overall revenues to £3.72 billion. However, these gains were ultimately insufficient to counterbalance the substantial cost pressures and fare adjustments. Operating costs for the airline jumped 11 per cent higher to £2.9 billion in the quarter, reflecting the impact of higher fuel expenses on the 20 per cent of its fuel requirements not covered by hedging agreements.
The volatile geopolitical situation continues to cast a long shadow over the airline industry. An interim peace deal between the US and Iran last month offered a brief reprieve to oil and energy prices, but these have since spiked again as negotiations faltered and fighting resumed. This ongoing instability makes it challenging for airlines like Ryanair to plan for the future, with Mr O’Leary stating it was too early to provide a full-year outlook, citing sensitivity to ‘adverse external developments, including conflict escalation in the Middle East and Ukraine, the price of unhedged jet-fuel, macro-economic shocks and continuing European air traffic control strikes and mismanagement’.
For British nationals planning travel, the Foreign, Commonwealth & Development Office (FCDO) travel advice remains a key consideration, particularly for destinations potentially impacted by regional instability. While Ryanair currently states fares are continuing to come down ‘modestly’ in the second quarter despite a slight rise in bookings, the booking window remains closer to departure than in previous years, indicating ongoing consumer caution. The airline also highlighted zero visibility for the second half of the year, making any meaningful full-year profit guidance impossible at this stage.