Ryanair CEO Michael O’Leary Talks Airlines, Fuel Risks

Summary

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Bloomberg Talks — Ryanair CEO Michael O’Leary Talks Airlines, Fuel Risks

Date: May 18, 2026
Host: Bloomberg
Guest: Michael O’Leary, CEO, Ryanair

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Episode Overview

This episode features a candid and lively interview with Ryanair CEO Michael O’Leary, delving into the airline industry’s ongoing volatility amid global events, especially energy price risks, the competitive landscape in Europe versus the US, and how Ryanair’s unique strategy is positioned for long-term success. O’Leary freely shares his trademark humor, sharp opinions on competitors, and sharp financial insight, providing a comprehensive look at the challenges and opportunities facing European aviation.

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Key Discussion Points & Insights

1. Industry Shocks and Ryanair’s Resilience

• O’Leary draws parallels between past crises (Ukraine, Gulf Wars, 9/11) and the current environment.
• Emphasizes Ryanair’s robust risk mitigation through aggressive fuel hedging:

  “That’s why in Ryanair we typically hedge 80% of our fuel. We’re 80% hedged out to March 27, 67 bucks a barrel. We’re in great shape.” (00:41)

• Notes stock market perception versus operational success:

  “Apart from the fact our share prices tanked … We just reported record full year results. 208 million passengers, 2.26 billion euros profit after tax … share buybacks.” (00:55)

2. Aircraft Strategy and Fleet Development

• Ryanair is prepared for opportunities created by weaker competitors faltering:

  “We are certainly ready to buy cheap aircraft. If anybody got any cheap aircraft, I’m really excited.” (01:37)

• Upcoming fleet renewal with Boeing MAX 10:

  “First 15 of our Max 10 aircraft from Boeing in the spring of 2027. 20% more seats per plane, burns 20% less oil … We’ve ordered 300 of those from Boeing. We priced them during COVID so we’ve basically stolen them.” (01:41)

3. European Airline Consolidation & Competitive Landscape

• Dismisses merit in acquiring entire rival carriers:

  “There is nothing in Europe you would want to buy. It’s all crap, you know, it will go bust, you know, in the not too distant future.” (02:15)

• Predicts European consolidation toward a US model—three large “connecting” carriers (BA, Lufthansa, Air France/KLM) dominating long-haul, short-haul left to Ryanair:

  “Short haul, Ryanair will continue to dominate … because we have much lower fares and much lower costs. We’re the only really low fare, low cost carrier in Europe.” (02:29)

4. Why the Low-Fare Model Succeeds in Europe vs. US

• Critiques US market for lacking true low-fare carriers:

  “We copied this formula from Southwest back in the late 1980s ... Now Southwest average fare last year was 140 bucks. It’s not a low fare carrier anymore.” (03:15)
  “If you had a real low fare carrier here in the States as Ryanair is in the US … our average fare last year was 40 bucks … There would still be very strong demand.” (03:24)

• Affirms no plans for US expansion:

  “No, absolutely not. We’re too busy expanding in Europe. … Europe is the best playground for low cost airline that you could possibly imagine.” (03:55)

5. Ryanair’s New Image

• O’Leary reflects on Ryanair’s evolving reputation:

  “We were never brutal. Cheap and less. We were cheap and mean. Now we’re just cheap and cheerful … record customer service metrics. Customer service satisfaction went up from 86 to 89%.” (04:47)

6. European & Transatlantic Travel Trends

• Cost of long-haul travel up, limiting European outbound to America; intra-European holidays rising.

  “A huge amount of Europeans will holiday at home in Europe … in Portugal, in Spain and Italy and Greece. … There’s a real sea change this year of people … probably going to stay at home in Europe this summer.” (05:14)

7. Jet Fuel Supply and Middle East Tensions

• On concerns over jet fuel supply amid Iranian conflict:

  “The jet supply has now … there’s no issues over jet fuel supply right now through till the end of September … Most of Europe’s Jet A1 supply comes from West Africa, the Americas, Norway. The lifting of Russian sanctions has also eased the supply.” (06:02)

• On the impact of the Straits of Hormuz closure:

  “We gave guidance this morning if it remains closed till March 2027…our unit costs might rise, you know, mid single digits this year.” (06:40)

8. Fuel Hedging: Ryanair's Secret Sauce

• Details on hedging:

  “We bought 80% of our jet fuel requirements … out to March 2027 at $67 a barrel. So we’re sitting…we’re in great position.” (07:07)

• Notes danger for less-hedged competitors should Straits of Hormuz closure persist.

9. Competitors at Risk

• Names specific at-risk airlines if the situation persists:

  “Some of our low fare but not so low cost competitors … Whiz could well be a candidate for failure. Airbaltic … they have to repay the loan in August. I mean good luck with the Latvians trying to get that repaid.” (08:01)

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Notable Quotes & Memorable Moments

• On the industry’s crisis cycle:

  “This happens regularly within our industry.” (00:41)

• On the business reality:

  “If my predictions were any good, I wouldn’t be working in the airline business, I’d be doing something in a proper functioning business like Bloomberg. I’ll get it right with your rock star salaries.” (08:36)

• On Ryanair’s transformation:

  “Now we’re just cheap and cheerful … I never thought I’d see the day when I got more than 50% customer satisfaction. But hey, who knew?” (04:47)

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Important Timestamps

• 00:34: Michael O’Leary introduces himself with signature humor (“old fart, aging dinosaur”)
• 00:41: Industry shocks and fuel hedging strategy
• 01:37: Ryanair’s aircraft purchasing and MAX 10 order
• 02:15: Dismissing airline acquisitions in Europe
• 03:04: US low-cost market critique
• 03:55: No plans for US expansion
• 04:47: Ryanair’s evolving customer reputation
• 05:14: Holiday trends: Europe vs. transatlantic
• 06:02: Jet fuel supply security in Europe
• 06:40: Straits of Hormuz and fuel hedging details
• 08:01: Naming vulnerable competitors

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Summary

This refreshingly candid conversation with Michael O’Leary gives listeners insights into the robust financial and operational strategies that have allowed Ryanair to thrive amid repeated industry shocks. O’Leary is both self-deprecating and brash, unafraid to skewer competitors or the industry’s inertia. Ryanair’s long-term fuel hedging, shrewd fleet investments, and relentless focus on cost discipline keep it far ahead of Europe’s struggling low cost and legacy airlines. Meanwhile, O’Leary provides clear-eyed analysis—often with biting wit—of the broader sector, predicting European consolidation and warning of casualties if energy-price volatility persists. For both aviation insiders and casual listeners, this episode is a masterclass in airline strategy delivered with unmistakable Irish flair.

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Transcript

[Indiana University Narrator]

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[Bloomberg Audio Studios Announcer]

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[Interviewer]

Joining us now, legend of the industry, the Ryanair boss, Michael o'.

[Michael O'Leary]

Leary.

[Interviewer]

Michael, good morning. Good to see you come. We've been friends for a while.

[Michael O'Leary]

You're come on to the industry.

[Interviewer]

How would you describe yourself?

[Michael O'Leary]

Old, far Old fart, I think. Yes. I think it's aging dinosaur.

[Interviewer]

You've seen it all. Sir, have you seen something like this before?

[Michael O'Leary]

The situation the Russians invaded Ukraine 20 years ago, the second Gulf War, the first Gulf War, 911. This happens regularly within our industry. That's why in Ryanair we typically hedge 80% of our fuel. We're 80% hedged out to March 27, 67 bucks a barrel. We're in great shape. Apart from the fact our share prices tanked in the last two weeks because, oh, they're an airline. Oh God, the hell. We're just reported record full year results. 208 million passengers, 2.26 billion euros profit after tax, spitting off cash to shareholders, share buybacks. And with a bit of luck, if this continues, although you know, we can all have a debate how long we think this will continue in the Middle east under the straits for most, some of the flaky competitors in Europe will get taken out in carrier baskets by about September, October because they're not hedged on oil and they're borrowed up to their eyeballs in net debt.

[Interviewer]

Are you right? Is it by.

[Michael O'Leary]

We are certainly ready to buy cheap aircraft. If anybody got any cheap aircraft. I'm really excited. We are about to get the first 10 of our Max 10 aircraft. First 15 of our Max 10 aircraft from Boeing in the spring of 2027. 20% more seats per plane burns 20% less oil at the technological efficiency of the new engines is remarkable. And we will take. We ordered, we've ordered 300 of those from Boeing. We priced them during COVID So we've basically stolen them. And they will transform even our operating economics in Europe for the next decade.

[Co-Interviewer]

So are you interested though in buying a carrier in its entirety? Aside from just their aircraft, There is

[Michael O'Leary]

nothing in Europe you would want to buy. It's all crap, you know, it will go bust, you know, in the not too distant future. Europe is inexorably, you know, moving the same direction the US did 20 years ago. Three large connecting carriers, BA Lufthansa, Air France, KLM. They are making out like bandits at the moment because all the long haul connecting traffic has switched off the Gulf carriers and is going on those legacy guys. Short haul. Ryanair will continue to dominate the short haul space in Europe because we have much lower fares and much lower costs. We're the only really low fare, low cost carrier in Europe. There's a few other low fare, not so low cost carriers in Europe, but they're all good do they're all going to go the same way as Spirit and Frontier in the States.

[Co-Interviewer]

That's what I wanted to ask. It seems like the model in the US is really struggling. We had Spirit go bankrupt. There's talk of mass consolidation among some of the other low cost carriers and

[Bloomberg Audio Studios Announcer]

this idea that every consumer is expecting

[Co-Interviewer]

higher quality and that that is what's generating a lot of the revenues. How does Ryanair succeed in that environment, in that demand backdrop?

[Michael O'Leary]

I mean, the problem for the last 20 years in the States is there's really been no low cost carriers anymore. I mean, we copied out this formula issue from Southwest back in the late 1980s when Herb Kelleher was in his pump. You know, Southwest charging $10, $10 fares. Now Southwest average fare last year was 140 bucks. It's not a low fare carrier anymore. If you had a real low fare carrier here in the States as Ryanair is in the US our average fare last year was 40 bucks. There would still be very strong demand because the main airlines here, I mean they've had control of the supply in the market for the last 20 years and they've been pricing up. The cost of air travel in the States is incredibly high, particularly given that you don't pay for Etc.

[Co-Interviewer]

Could you expand into the U.S. no, absolutely not.

[Michael O'Leary]

We're too busy expanding in Europe. And in those countries around Europe there is so much growth available to us. In Europe you look at last year we grew 4% with the biggest airline in Europe. We grew to 4%, 208 million passengers. This year I grew another 4%, 260 million passengers. And in the next decade, with these Max 10 aircraft, I'm going to go to 300 million passengers all in Europe. I mean Europe is the best playground for low cost airline that you could possibly imagine. A couple of big useless legacy airlines charging more, you know, charging annual salaries for their long haul travel, but nobody able to do the low cost stuff. We do the low cost stuff well. We're cheap Irish guys, you know, and so we do it well with the With a, with an order for 300.

[Interviewer]

Really fantastic aircraft used to be so mean back in the 90s, which used to be so mean. It was brutal. Remember that?

[Michael O'Leary]

Yeah, well, we were never brutal. Cheap and less. We were cheap and mean. Now we're just cheap and cheerful. New aircraft on time flights, huge. I mean last year our custom we were record customer service metrics. Customer service satisfaction went up from 86 to 89%. I never thought I'd see the day when I got more than 50% customer satisfaction. But hey, who knew?

[Co-Interviewer]

Can I ask you where Europeans traveling to this summer for vacation? Do they want to come to America anymore?

[Michael O'Leary]

No, no, I mean that's not true. Yes, they do. But the problem is that the cost of long haul travel has got very expensive. So, you know, there isn't much competition across the Atlantic between the European legacies and the US Majors. The Gulf carriers were the real disruptors for the last 20 years and they have, you know, their capacity has been halved in recent months. So a huge amount of Europeans will holiday at home in Europe this year in Portugal, in Spain and Italy and Greece. A lot of Americans are still coming to Europe for the quality, for the sunshine, the culture and the alcohol. And along with, they continue to travel. But I think there's a real sea change this year of people who would historically have gone to the Middle east are using the Middle east carriers to connect to long haul. Probably going to stay at home in Europe this summer.

[Co-Interviewer]

When will Europe run out of fuel?

[Michael O'Leary]

It won't. There was a real concern, I think back in April, you know, there was real worries over supply. Jet supply. The jet supply has now we met with all of our fuel suppliers in Paris last week. There's no issues over jet fuel supply right now through till the end of September. There's one issue in the uk Kuwait, which is the subsidiary of the state of Kuwait, have about 30% market share. Some of the airports in the UK even they now are resourcing that supply. Most of Europe's Jet A1 supply comes from West Africa, the Americas, Norway. And the lifting of Russian sanctions has also eased the supply jet 1 into Eastern European countries.

[Co-Interviewer]

So you don't seem concerned with what's going on right now with the conflict in Iran.

[Michael O'Leary]

I'm very concerned about the price of oil and. But I don't believe the conflict in Iran will have any disruption on European jet supplies. I do. The question for us is how long will the Straits of Hormuz remain closed? I mean, you know, we, we gave guidance this morning if it remains closed till March 2027, our unit, because of our own hedged 20% our unit costs might rise, you know, mid single digits this year.

[Interviewer]

Nobody believes what are you, can you just explain your current hedging strategy?

[Michael O'Leary]

What do you fuel. We bought 80% of our jet fuel requirements, John, out to March 2027 at $67 a barrel. So we're sitting, you know, we're in great position, great position but nobody really believes that the streets for moves are going to stay closed until March of next year. It's just we don't know when they're going to reopen. Iran is going to starve if they don't get it ready or the straits for moves reopened in the next couple of months. The midterm election season kicks off in Memorial Day at the end of May. You know, Trump is going to lose the House and the Senate if he doesn't get this resolved and reopened. But the timing is none of us know when the timing will be. But you know, I hope it's sooner rather than later. But if it stays, if it becomes later, say it's staying out for something happens that none of us expect. The Straits stay closed in September, October, November, then we are looking at our unit costs will be up about 5% but you'll be looking at kind of airlines failing all over Europe.

[Co-Interviewer]

Who's failing?

[Michael O'Leary]

Well I can't really name them but you know, some of our low fare but not so low cost competitors easyjet with I don't think easyjet will fail. I don't make any money this year. Whiz could well be a candidate for failure. Airbaltic, which was recently bailed out by the Latvian government gave it a 30 million loan to get them from June through to August. But they have to repay the loan in August. I mean good luck with the Latvians trying to get that repaid at the end of August. So I think there will be casualties but again, a lot depends on how I mean you know more about this than how long the straits for moves remains open remain closed. When can Trump declare a victory and you know, kick off the midterms And I suspect it's probably going to be the end of May, maybe early June. But what I mean if I was any, if, if, if my predictions were any good, I wouldn't be working in the airline business doing something in a proper functioning business like Bloomberg. I'll get it right with your rock star salaries.

[Interviewer]

I'll get it right this time. Michael Leary, Old farm at the airline industry boss of Ryanair Michael, Good to see you buddy. Thank you to see you Judge Preparing

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