LONDON, May 15, 2026, 14:05 BST
International Consolidated Airlines Group SA has completed its €500 million share buyback, buying 116,823,728 ordinary shares after a final purchase on May 14, a filing showed. The shares equal about 2.53% of issued capital and are being held in treasury, meaning by the company itself, before a planned cancellation that still needs shareholder approval.
The timing is the point. A buyback, when a company uses cash to purchase its own shares, can lift earnings per share by reducing the share count, but IAG is doing it while investors are pressing the British Airways owner on fuel costs, summer fares and the Strait of Hormuz disruption.
IAG shares traded at 374.50 pence, down 2.58%, at 13:47 BST, data carried by Investors Chronicle showed. That left the stock below its Feb. 27 52-week high of 464.28 pence, even after a year-on-year gain of more than 16%.
The first-quarter numbers gave IAG something to lean on. The group reported revenue up 1.9% to €7.18 billion and operating profit up 77.3% to €351 million, while liquidity stood at €12.73 billion and net debt at €4.18 billion. Chief Executive Luis Gallego said IAG saw “no issues with fuel availability in our main markets” but also said higher fuel costs would mean “lower profit this year than we originally anticipated.”
Still, the guidance has already moved. Reuters reported last week that IAG said annual profit, free cash flow — cash left after operating and investment needs — and capacity, or the amount of flying it can offer, would be below earlier projections. IAG put 2026 jet fuel costs at about €9 billion and said 70% of expected fuel needs were hedged, meaning protected through contracts; J.P. Morgan analyst Harry Gowers wrote that the “current conflict will prove the resiliency of the group.” Reuters
The pressure is not IAG’s alone. Reuters reported Thursday that European airlines and airports were trying to reassure travellers before the peak summer season, while Lufthansa said supplies were secured at least to early summer and Ryanair’s Michael O’Leary had said the risk of disruption was receding. Airlines have also been paying premiums to source fuel from countries including the United States and Nigeria.
The waterway remains the hinge. Iran’s foreign minister said Friday that Tehran had “no trust” in Washington and that talks were on hold, while U.S. Trade Representative Jamieson Greer said China wanted the Strait of Hormuz reopened without curbs or tolls. Nearly a fifth of global oil and liquefied natural gas supplies pass through the strait in normal times, Reuters reported. Reuters
Prediction markets also show little confidence in a fast fix. Polymarket showed a 7% chance that Strait of Hormuz traffic returns to normal by the end of May and 46% by July 31, while Kalshi put normal traffic before Aug. 1 at 37% and before Oct. 1 at 60%. Those prices are trading odds, not formal forecasts.
The risk is plain enough. If fuel premiums stay high and rivals keep adding seats, IAG may have to raise fares into a market where some holidaymakers can still delay or trade down. That would test how far the group can defend margins while keeping planes full.
A quicker reopening of Hormuz would change the argument. It could ease fuel pressure and leave IAG’s long-haul and premium-cabin strength looking more valuable than the market is allowing for now. For the moment, the buyback says IAG still has cash discipline; the share price says investors want proof that the fuel shock will not eat it.
