Budget fliers, beware: one airline CEO has predicted that airfares could continue climbing to unprecedented prices in 2027.
Ryanair CEO Michael O’Leary said on Monday that he expected European airfares to become as much as 20% more expensive next year.
The prediction comes as jet fuel prices have continued to spike amid the ongoing war with Iran.
“So we’re facing 2027 where we have much higher oil prices... I think they’re going to get passed on in significantly higher airfares,” O’Leary said in an interview with CNBC.
The elevated cost of jet fuel has been putting pressure on carriers in the United States and around the world to not only increase airfares, but also cut unprofitable flights and adjust annual earnings predictions to be much more conservative.
Airfares jumped by nearly 23% year over year in September 2026, according to the Bureau of Labor Statistics, and holiday airfares are the most expensive they’ve been in a decade, according to a report from travel deal site Hopper.
Some U.S. carriers, like Delta, predict fuel bills for 2026 to be $6 billion more expensive compared to 2025. The carrier noted in its October earnings call that its fuel costs for the third quarter of the year increased by a whopping 62% year over year.
Unlike most U.S. carriers, many European carriers attempt to stabilize their fuel costs through a process called hedging. However, some of those protections are going to expire in 2027, according to O’Leary.
“The market customers have been insulated for the last 12 months... but those hedges are rolling off,” O’Leary said. “There’s still no resolution in the Middle East. Jet oil today is $170 a barrel. I mean, this is a very significant cost cliff we’re all facing next year. I believe you’re going to see airfares rise next year across Europe by 10%, maybe even 20%.”
Ryanair expects its 2027 fuel bill to increase by at least 2 billion euros. As such, the carrier said it will be launching a cost review, “which will include lowering crew rations, a potential temporary pay freeze and the use of AI to drive further efficiencies,” according to CNBC.
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