Ryanair Reports Fall in Profits as US-Iran War Intensifies

As war in the Middle East intensifies following US strikes on Iran, jet fuel prices have soared, causing customer hesitancy over booking flights.

Ryanair, one of many airlines affected, have announced a fall in revenue, with the firm’s pre-tax profits dropping 34% to €593m (US$678m) between April and June, while sales remained flat.

The company was subsequently forced to cut fares to encourage flyer demand.

Ryanair says it expects summer fares to be lower than the prior year due to “consumer hesitancy” around travelling by plane.

Fuel costs for air travel have increased since the beginning of the US-Iran war in February and while Ryanair says it struck deals for most future fuel costs, those not included in these arrangements had more than doubled.

The impact on global trade

As the war continues, the price of crude oil continues to rise.

The price per barrel has now surpassed US$90 for the first time in a month, after two days of rising conflict between the US and Iran.

Additionally, traffic through the Strait of Hormuz – the route most essential for global gas and oil supplies – has completely halted. Following this, Brent crude, the global benchmark for oil prices, rose by 2.5%.

Ryanair warns that its results for the year will be “highly sensitive” to external factors like further conflict escalation in the Middle East and Ukraine as well as the price of jet fuel.

Discussing the economic fallout following the rise in conflict, Head of Investment Strategy at AMP Shane Oliver says: “The longer the strait remains closed and the war escalates, the greater the risk that oil prices will have to rise to around US$150 a barrel to bring demand down to match the hit to supply. This is not our base case but it's a high risk again.”

Ryanair’s second-quarter performance

Last month, an interim deal between the US and Iran offered some brief respite to oil and energy prices, however they spiked after negotiations broke down and the conflict continued.

Ryanair CEO Michael O’Leary says the airline has taken action to reduce fares as the Middle East conflict continues to create consumer hesitancy and raise concerns around European jet fuel shortages.

Michael says it’s too early to give an outlook for the year regarding Ryanair’s results, adding that the outcome would be dependent on areas like “adverse external developments, including conflict escalation in the Middle East and Ukraine, the price of unhedged jet-fuel, macro-economic shocks and continuing European air traffic control strikes and mismanagement”.

The company says fares are continuing to come down “modestly” in the second quarter, despite a small rise in bookings, with passengers continuing to book flights close to departure.

Michael goes on to say that while the summer period looks promising, “the booking window remains closer-in than last year which further reduces visibility”.

He adds: “As is normal this early in the year, we have zero second half visibility so it remains far too early to provide any meaningful full-year 2026-27 profit after tax guidance.”