Jet fuel supplies could be disrupted in early May if the Middle East conflict continues, the boss of Ryanair has warned.
Oil prices have surged since the war in Iran broke out at the end of February due to Iran’s block on tankers passing through a key shipping passage, the Strait of Hormuz.
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Speaking to our lead presenter, Wilfred Frost, Michael O’Leary said Ryanair was “reasonably well hedged” on 80% of its fuel but added it is paying almost double (at around $150 a barrel) on the other 20%.
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He warned that rising oil costs were part of the “wider ramifications” of the conflict, but the more “immediate concern” was over jet fuel supplies.
“Fuel suppliers are constantly looking at the market. We don’t expect any disruption until early May, but if the war continues, we do run the risk of supply disruptions in Europe in May and June, and we hope the war will finish sooner than that and the risk to supply will be eliminated,” he told Sky News.
“We think there is a reasonable risk, some low level, maybe 10% to 25% of our supplies might be at risk through May and June, so like everyone else in this industry, we hope the war ends sooner rather than later
“If the war finishes by April and the Strait of Hormuz reopens, then there is almost no risk to supply.”
Despite this, he said he doesn’t expect to cancel any flights like some of Ryanair’s competitors.
EasyJet chief executive Kenton Jarvis has previously warned that European consumers should expect higher ticket prices towards the end of summer when existing fuel hedges come to an end.
