Ryanair CEO Warns European Airlines Face Collapse From High Jet Fuel Costs
The head of Europe's largest budget carrier warned Monday that multiple airlines on the continent will fail if jet fuel prices remain at their current elevated levels, a direct consequence of the ongoing closure of the Strait of Hormuz. Ryanair CEO Michael O'Leary said the cost pressure is squeezing carriers just as they enter the peak summer travel season, a period when airlines typically generate the bulk of their annual revenue.
"European airlines will fail if jet fuel costs stay high," O'Leary told Politico Europe, pointing to the more than doubled price of jet fuel since the strategic waterway was shut. The warning comes as carriers across the continent scramble to adjust their summer schedules and fare structures to account for the unprecedented fuel expense.
Fuel Price Increase
Jet fuel prices in Europe have more than doubled since the closure of the Strait of Hormuz, a chokepoint through which roughly 20% of the world's oil passes daily. The price surge represents the most dramatic fuel cost increase for European aviation since the 1973 oil crisis, according to industry data cited by Politico Europe.
The Strait of Hormuz closure, which occurred before April 28, has disrupted global oil supply chains that feed European refineries. European carriers, which rely heavily on imported jet fuel, have been hit particularly hard because they lack the domestic refining capacity of competitors in North America or the Middle East.
Summer Season Under Threat
The timing of the fuel crisis is particularly damaging for the industry. European airlines typically generate between 60% and 70% of their annual profits during the June-through-August summer travel window, when holiday traffic peaks across the continent.
O'Leary's warning indicates that carriers with thinner profit margins or higher debt loads will not survive the summer if fuel costs remain at current levels. Ryanair itself, known for its aggressive cost-cutting and fuel hedging strategies, has more financial cushion than many competitors, but the CEO's public statement signals deep concern about the broader industry landscape.
Industry Fallout
The Ryanair chief's assessment carries particular weight given his airline's position as Europe's largest carrier by passenger numbers, operating more than 3,000 daily flights across 40 countries. His warning echoes concerns raised by other aviation executives in recent weeks, though O'Leary was the first to explicitly predict airline failures.
European aviation authorities have not yet commented on the situation, and no specific carriers have been named as being at immediate risk. The European Commission has not announced any emergency measures to stabilize fuel supplies or provide relief to affected airlines.
The closure of the Strait of Hormuz continues, with no announced timeline for reopening. Until the waterway is operational again, European airlines face the prospect of paying double or more for the fuel that powers their fleets—a cost that O'Leary said will inevitably lead to consolidation and failures across the industry.