LONDON, April 24, 2026, 17:06 BST
- IAG said it will lift ticket prices to reflect higher jet fuel costs.
- The British Airways owner said it has not seen jet fuel supply interruptions.
- Shares in IAG were down 1.6% in late London trading.
International Consolidated Airlines Group SA said it will raise ticket prices as higher jet fuel costs hit the British Airways owner, though the company said it was not seeing fuel supply interruptions. The move puts IAG into a widening group of carriers passing a war-driven fuel shock to passengers before the peak summer travel period.
The timing matters. Airlines are heading into the busiest months of the year with oil markets strained by the U.S.-Israeli war with Iran and the blockage of the Strait of Hormuz, a route tied to global energy flows. IAG shares were quoted at 376.30 pence, down 1.62%, with a market value of about 16.91 billion pounds.
Fuel is one of the biggest airline costs, and fare rises can test demand quickly when households are already price-sensitive. European carriers have been partly protected by hedging, financial contracts used to lock in future fuel prices, but that shield weakens as old contracts expire.
IAG said it was “not immune” to the wider fallout even with hedges in place. A company spokesperson called for government “flexibility,” including airport slot relief; slots are takeoff and landing rights, and relief would let carriers cut schedules without risking the loss of those rights. Reuters
The group owns British Airways, Iberia, Vueling, Aer Lingus and LEVEL. It is registered in Spain, has its corporate head office in London, and trades on both the London and Spanish stock exchanges.
The shock comes less than two months after IAG reported a record 2025 performance. Revenue rose 3.5% to 33.21 billion euros, operating profit before exceptional items rose 13.1% to 5.02 billion euros, and the company said it was 62% hedged on fuel for 2026 under assumptions published in February.
Chief Executive Luis Gallego had said with those results that IAG was “confident” looking ahead, helped by long-term travel demand and constrained industry supply. The new fuel pressure gives investors a cleaner test of that case when IAG reports first-quarter results on May 8.
Peers are already under strain. TUI cut its profit outlook this week and suspended revenue guidance, citing uncertainty from the Iran war and jet fuel supplies, while saying its airline and hotels businesses had been hit by a shift in demand away from Turkey, Cyprus and Egypt.
EasyJet CEO Kenton Jarvis said last month that prices would start “feeding through to the consumer” toward the end of summer as hedges roll off. Air France-KLM has also moved to add a jet fuel surcharge on some long-haul tickets, Reuters reported. Reuters
Regulators are moving too. EU Energy Commissioner Dan Jorgensen told Reuters the bloc could use “redistribution tools” if supply becomes a security problem, while the European Commission is weighing jet fuel reserve rules and closer monitoring of refinery output. Reuters
The downside is not just higher fares. If fuel supply tightens further, airlines may have to cut capacity, and the pressure would fall hardest on weaker routes or price-sensitive leisure traffic. But if energy flows normalise or hedges buy enough time, IAG may be able to push through part of the cost without a sharp hit to bookings.
For now, IAG’s message is narrow but firm: prices are going up, supply is holding, and the fuel bill is no longer just an oil-market story. It is moving into ticket prices.
