Ryanair warns of jet fuel supply disruption in May
Ryanair’s boss has warned that jet fuel supplies could be disrupted as early as May if conflict in the Middle East continues.
Oil prices have surged since the war broke out in Iran in late February after Iran banned tankers passing through the Strait of Hormuz, a key shipping route.
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Talking to our main presenter, Wilfred Frost, Michael O’Leary said Ryanair was “reasonably well hedged” on 80% of its fuel, but he said it was paying almost double (at about $150 a barrel) on the other 20%.
He warned that rising oil prices were part of the “wider impact” of the conflict, but the more “immediate concern” was over jet fuel supplies.
“Fuel suppliers are constantly monitoring the market. We don’t expect any disruption until early May, but if the war continues, we risk supply disruptions to Europe in May and June, and we hope the war will end before then and the supply risk will be eliminated,” he told Sky News.
“We think there is a reasonable risk, some low level, maybe 10% to 25% of our supply could be at risk during May and June, so like everyone in this industry, we are hopeful that the war will end soon.
“If the war ends by April and the Strait of Hormuz reopens, there will be almost no threat to supplies.”
Despite this, he said he did not expect Ryanair to cancel any flights like some of its competitors.
EasyJet Chief Executive Kenton Jarvis previously warned that European consumers should expect higher ticket prices at the end of the summer when existing fuel hedging ends.
