Ryanair’s boss rubs his hands. Tourists are to expect cheap flights

Political turmoil in the US has translated into a decrease in aviation fuel prices, and this is not a worry for everyone. According to S&P Global Commodity Insights in April, it costs over 10 percent by following lower oil prices. The duties of US President Donald Trump caused concerns about the condition of the world economy.

Ryanair flight prices. The boss of the line took an important step

The situation on the fuel market is conducive to airline, especially cheap carriers. Fuel is a majority of their total costs than in the case of lines that realize flights over long distances. The “Financial Times” informs that the head of the Ryanair line has signed a long -time hedging contract for the purchase of fuel. Thanks to this, the Irish low -cost for two years has a guaranteed price, regardless of the situation on the oil market.

“We and our passengers will be a very significant beneficiaries of the net of a violent drop in oil prices,” said O’Leary. Ryanair announced that he had secured fuel costs at the level of $ 77 per barrel for the financial year 2026. The price of aviation fuel last week was about $ 66 per barrel.

Risky strategy

Such a strategy, however, is not always profitable. If the oil price for a barrel falls, the carrier will be forced to buy fuel at a higher price than competitors. In 2020, when Coronavirus pandemic broke out, Ryanair lost EUR 300 million due to a vicious plant for prices just lockdown. The contracts obliged the line to pay more. Despite this, as RP.pl notes, Michael O’Leary remains faithful to such a strategy.

The Irish competitor, Wizz Air, was in a different situation – he stopped using this instrument before he was surprised by the full -scale invasion of Russia to Ukraine in 2022. This caused a rapid increase in oil prices. Since then, the airline has resumed securing in this way.