Ryanair is considering a temporary wage freeze to help absorb a sharp rise in fuel costs tied to the war between the United States, Israel and Iran, which the airline says could keep jet fuel prices elevated "well into 2027" absent a swift resolution to the conflict.
The Irish carrier expects its fuel bill to come in roughly €2 billion higher than previously budgeted over the near term. About 80 percent of its fuel needs are hedged, but the cost of the remaining unhedged fifth has roughly doubled since the war disrupted tanker traffic through the Strait of Hormuz. For the six months to Sept. 30, pre-tax profit fell 16 percent to €2.4 billion, largely on fuel.
Chief executive Michael O'Leary said last month he expects Ryanair and other European carriers to raise fares 15 to 20 percent next year, though the airline says fare increases alone won't be enough to offset the higher fuel bill — hence the wage-freeze discussion, which Ryanair has not yet finalized or presented formally to staff. The airline has not said which employee groups would be affected or for how long a freeze might last.
A sector-wide squeeze
Ryanair's warning echoes a broader pattern across the airline industry since the Iran war began disrupting Gulf shipping lanes: carriers that built their business models on predictable, low fuel costs are now recalculating route profitability in real time. Oil prices tracked by the International Energy Agency have stayed elevated for months as tanker operators reroute around the strait or pay sharply higher war-risk insurance premiums.
The airline said it had not yet heard back from Unite, the union representing many of its UK-based staff, on the wage-freeze proposal. Analysts say the real test will come when Ryanair reports full-year results in the spring, when the gap between this year's hedges and next year's unhedged exposure becomes clearer.
