Ryanair chief executive Michael O’Leary issued a warning on Thursday that airline ticket prices are likely to surge significantly if oil costs remain at current levels, exacerbating pressure on the aviation sector. The comments came ahead of the carrier’s annual general meeting as energy markets reacted to escalating geopolitical instability in the Middle East.
O’Leary noted that while the airline anticipates a modest decline in pricing during the second quarter, running from July through September, the outlook for the December and March quarters remains highly uncertain. “We expect pricing to be very modestly down in the second quarter, but the December and March quarters are entirely up in the air,” O’Leary told reporters, according to reports from Reuters.
He added, “If oil prices remain high into next year, I think there will be a significant uplift in airfares, and we would hope to avoid that.” CNBC has reached out to Ryanair for additional comment on these statements.
The warning follows a sharp rise in global energy costs. On Thursday, oil prices inched higher as fears mount that conflicts in the Middle East could disrupt critical energy supply routes. Brent crude continued to trade above $100 per barrel, while U.S. West Texas Intermediate (WTI) crude futures climbed 1.4% to $97.4 per barrel.
My heart sinks reading this. Winter travel was supposed to be affordable. What are we supposed to do now?
Can someone explain how high oil prices lead to modest price drops in summer but hikes in winter? Makes no sense.
This is exactly why I take the train when possible. Flying is becoming a luxury only the wealthy can enjoy.
Another excuse to charge more? Fuel hedging is standard practice. I hope regulators step in.
I already booked my holiday for the winter. Please don’t raise prices again, I cannot afford it.