Ryanair rules out fuel surcharge as airlines respond to rising costs

Airlines across Europe are facing higher jet fuel costs, with some cutting capacity or raising fares as the war in Iran continues to drive up fuel prices.

Ryanair's boss, however, said that the airline will not introduce a fuel surcharge despite rising jet fuel prices, but predicted other airlines would.

“Ryanair will not levy a fuel surcharge, but the legacy guys certainly will next summer,” Ryanair group CEO Michael O’Leary said, according to Reuters.

Mr O’Leary said airlines had been mostly protected from this summer’s higher oil prices by fuel hedging but added that "none of us will be able to absorb those much higher oil prices next year”. 

Ryanair had also already announced plans to reduce its expected passenger numbers for the April 2026 to March 2027 financial year from 216 million to 214 million due to high jet-fuel costs. 

Its CEO’s comments come as European airlines continue to adjust to the impact of higher jet fuel prices.

Airlines cut back on capacity

Wizz Air said last week that it would cut its planned capacity by 5% for the second half of its financial year, citing higher fuel prices and geopolitical uncertainty.

The airline, however, reported a stronger-than-expected summer and raised its near-term revenue outlook. It also said it has fuel hedging covering 80% of its requirements for the next 12 months.

Meanwhile, Greek airline AEGEAN has taken a more cautious approach to capacity.

In its first-half results published on September 14, the airline said the rise in fuel costs had continued to put pressure on profitability.

“Given that the price of jet fuel is currently double that of the beginning of the year, the company is planning a very disciplined capacity policy, at least for the next 6-8 months,” CEO Dimitris Gerogiannis said in a press release. 

Air France has also raised ticket prices to offset higher fuel costs, although premium, business and first-class bookings and revenue had continued to grow despite the higher prices, CEO Ben Smith told Reuters. 

On the other hand, Latvian airline airBaltic filed for Chapter 11 bankruptcy protection in the US on September 14. The airline now continues to operate while it goes through the restructuring process.

No immediate EU fuel shortage

The European Commission said on September 8 that there was no immediate oil supply problem in the EU.

The Commission’s Oil Coordination Group said increased production in Europe, along with imports from other countries, was helping to meet demand for jet fuel and diesel. It said fuel stocks, including emergency reserves, were at sufficient levels.

However, “the evolution of the conflict in the Middle East, as well as the usual demand trends for autumn and winter could have an impact in the next weeks and months and further tighten the markets,” the Commission said. 

Europe could face a jet fuel shortfall of 510,000 barrels a day in the final quarter of the year, with fuel stocks at the Amsterdam-Rotterdam-Antwerp (ARA) trading hub already at a seven-year low, Reuters reported.

New imports could help prevent a wider shortage, although smaller airports remain more vulnerable.