Jet Fuel Costs Squeeze Travel Demand
Rising fuel prices are pushing airfares up and softening travel demand in Europe and Asia, according to Booking Holdings and Ryanair.
Updated on Nov. 10, 2026 in Travel — General
Live Poll
Are you planning to take fewer trips because of higher travel costs?
Booking Holdings CEO Glenn Fogel reported a softening of travel demand in Europe and Asia, while Ryanair is considering pay freezes and greater use of AI to curb rising jet fuel costs. Domestic travel outperformed international travel from July through September.
Why it matters
Jet fuel prices are rising faster than wages, and soaring fuel costs are feeding into airline ticket prices. The ongoing war between the US, Israel and Iran has kept fuel prices elevated, affecting travelers planning trips worldwide.
Domestic travel grew at high single-digit percentage rates while international travel grew at low single-digit rates from July through September. Ryanair has hedged around 80 per cent of its jet fuel at prices well below the market rate, but that hedge is due to fade after the current financial year ends.
The players
Booking Holdings
A global online travel company whose booking data offers a broad view of consumer travel trends across regions.
Ryanair
Europe's largest low-cost airline, known for its aggressive cost-control strategy and extensive fuel hedging program.
The details
Booking Holdings reported softer travel demand in Europe and Asia, while domestic trips outperformed international ones. Ryanair is weighing pay freezes and increased AI use to offset higher fuel bills, and expects European short-haul airfares to rise materially, though not enough to fully offset fuel costs.
Timeline
July through September 2026: Domestic travel outperformed international travel.
Fourth financial quarter 2026: Costly travel expenses are expected to weigh on consumer habits.
End of Ryanair's current financial year: Its jet fuel hedge begins to fade out.
April 2027 through March 2028: Ryanair predicts roughly £1.7bn in fuel price escalation.
Travel Outlook
Ryanair's jet fuel hedge, covering around 80 per cent of its fuel at prices well below market, has cushioned the airline so far but is set to fade after its current financial year. That shift means European short-haul fares are expected to rise materially as the protection runs out.
Travelers should expect airfares on European short-haul routes to climb as airlines pass on higher fuel costs. Booking trips earlier may help avoid the steepest increases as hedging protection winds down.
The takeaway
Fuel costs are becoming a larger factor in what travelers pay, so comparing fares early and considering domestic trips may help manage budgets as airlines adjust prices.
What happens next
Ryanair's jet fuel hedge is due to fade out after the end of its current financial year, and the airline has projected roughly £1.7bn in fuel price escalation for April 2027 through March 2028.
Further reading
For broader context on how these pressures shape trip planning, explore Travel — General coverage.
Source note: This article includes information reported by The Independent.
Live Poll
Are you planning to take fewer trips because of higher travel costs?
