Michael O'Leary, the chief executive of Ryanair, has warned that European airfares could rise by as much as 20% in 2027, calling it the largest increase in the continent's aviation history. Speaking at a press conference in Brussels on Tuesday, he attributed the surge to soaring jet fuel prices, higher environmental taxes, and a reduction in available seats due to market consolidation.
O'Leary told Euronews that airlines are facing a "doubling" of their fuel costs next year, as most carriers, including Ryanair, have limited hedging protection from April 2027. "We're 85% unhedged next year, and most of the other European airlines are in a similar position," he said. Ryanair had locked in fuel at about $67 a barrel for this year, but O'Leary noted that "our oil price will double" in 2027.
The warning comes as jet fuel prices in Europe and the CIS averaged $207.61 a barrel in the week ending 16 October, according to the International Air Transport Association (IATA) — a nearly 128% increase year-on-year. The surge is largely driven by the ongoing Iran war and the effective closure of the Strait of Hormuz, a critical chokepoint for global oil shipments. Brent crude futures traded at $109.86 on Wednesday, near a five-month high.
Capacity crunch and tax hikes add to pressure
Beyond fuel, O'Leary pointed to a shrinking supply of seats across Europe. Bankruptcies and takeovers in the aviation market are expected to reduce capacity in 2027, further pushing up prices. "You're going to see airfares rise next year in Europe, I think by 10, 15, maybe 20%. You're going to see the biggest increase in airfares, I would say, in history in Europe for the next 12 months," he said.
The Ryanair chief also criticised European environmental taxes, which he argues add unnecessary costs for airlines and passengers. His comments echo his earlier criticism of European Commission President Ursula von der Leyen over green regulations. O'Leary was in Brussels to announce a significant cut to Ryanair's operations in Belgium, ahead of a planned increase in the country's aviation tax from €2 to €7 in January 2027.
While O'Leary's predictions are stark, they align with broader industry trends. The recent expansion of routes by Ryanair and easyJet for summer 2027 may seem at odds with the capacity concerns, but O'Leary insists that the overall market will shrink as weaker carriers exit. He also noted that despite the fuel price spike, he does not foresee a jet fuel shortage in Europe through the summer of 2027, as he stated earlier.
For travellers, the message is clear: book early and expect higher fares. For the industry, the coming months will test the resilience of Europe's aviation market, which has already weathered pandemic disruptions and now faces a new era of costly fuel and tighter margins. As O'Leary put it, "the era of cheap flights may be coming to an end."
