The boss of Europe’s biggest airline has warned that jet fuel supplies could be at risk if the Iran war continues for another month.
“We don’t expect any disruption until early May, but if the war continues, we do run the risk of supply disruptions in Europe in May and June,” Ryanair CEO Michael O’Leary told Sky News on Wednesday.
He added that 10% to 25% of Ryanair’s supplies could be at risk through May and June. “So like everyone else in this industry, we hope the war ends sooner rather than later.”
Jet fuel prices have been more volatile than oil since the war started in late February. While Brent crude is up about 50% over the past month, jet fuel has doubled, according to statistics shared by the International Air Transport Association.
Ryanair and its subsidiaries make up Europe’s biggest airline group by passenger numbers, carrying over 200 million last year.
It has suspended its 12 flights to Jordan due to the conflict, O’Leary said, but jet fuel is the more immediate concern.
While the budget airline has hedged about 80% of its fuel costs until next March, that leaves about 20% exposed to price rises, the CEO told Sky News.
However, O’Leary was not concerned about canceling many flights.
“Most of Europe takes most of its jet fuel supplies from America, western Africa, and Norway,” he told Sky News.
Although he added that some suppliers are more dependent on the Middle East, too.
“We think our supplies are secure and we intend to continue to grow through this crisis,” O’Leary said.
Ryanair has also benefited from more Europeans looking to travel closer to home over the Easter break.
“Lots of families who would have been going either to the Middle East or flying over the Middle East to go to Asia have all rebooked, and they’re going to Italy, Portugal, Spain, Greece,” O’Leary told Virgin Media News on Wednesday.
“They’re all certainly staying much closer to home over the Easter school holiday,” he added. “People are not yet changing their summer holiday plans, but that’s likely to happen if this war continues.”
O’Leary also recommended that people book their flights as soon as possible, due to the risk that airfares continue to rise.
Read the full article here
