Ryanair CEO predicts some airlines will not ‘survive’ the winter due to increasing oil prices!
Ryanair reported a record annual profit Monday (1.45 billion euros profit after tax in its financial year ending March 31), despite concerns over a previous rostering mess-up that triggered a dispute with pilots. Yet, O’Leary said he was “pessimistic” over the company’s growth prospects in the near-term amid higher fuel costs and no fare growth.
The Irish airline warned that elevated oil prices — and consequently fuel costs — would probably cause some of its regional peers to go bust in early 2019. A dramatic upswing in crude futures over the past 12 months has weighed on the industry, at a time when major airlines are being forced to adapt to a much more competitive marketplace.
“Clearly $80 a barrel oil is going to bring casualties in Europe this winter,” Ryanair CEO Michael O’Leary told CNBC’s “Squawk Box Europe” Monday.
“Oil is going to be a driver but I think it will be a driver of change to the competition landscape in Europe. Some of those airlines who couldn’t make money when oil was at $40 a barrel last year, I don’t think will survive this winter if oil remains up at these elevated levels,” he added.