Ryanair is considering implementing a temporary wage freeze for its employees to offset a sharp increase in fuel expenses driven by the conflict between the US, Israel, and Iran. The airline warned that fuel prices could remain elevated well into 2027 unless a swift resolution to the war is achieved.
The carrier forecasts that its fuel bill will be €2bn (£1.6bn) higher in the short term. While Ryanair plans to increase European airfares to help cover these additional costs, it indicated that this measure alone may be insufficient. Consequently, the airline is exploring various strategies, including temporary pay freezes for workers. The BBC has reached out to Unite, the union representing Ryanair staff, for comment on the matter.
Financial results for the six months ending in September show a 16% decline in pre-tax profits, totaling €2.4bn, largely attributed to rising fuel costs. Although 80% of Ryanair's fuel bill was hedged at fixed prices in advance, the cost of the remaining portion has doubled. This surge in aviation fuel prices is linked to the Middle East war, which has significantly reduced the supply of refined products from the Gulf and intensified competition for supplies produced elsewhere.
Michael O'Leary, Ryanair's chief executive, stated last month that he expects his company and other airlines to raise fares by 15% to 20% next year in response to these market conditions.
Sources: BBC News World.