Airlines are entering 2027 with sharply different fuel protections as higher jet-fuel prices pressure costs and test how much of the burden passengers will accept.
The International Air Transport Association (IATA) monitor put the global jet-fuel average at $196.70 a barrel for last week, 2.2% above the previous week. The reading comes as the Iran war keeps fuel-price uncertainty in focus for carriers.
Finnair's Oct. 27 interim report set its average hedging ratio for 2027 at 34%. The airline attributed the slower pace of new hedges to elevated prices and uncertainty about future fuel costs. It estimated that a 10% move in fuel prices would change its comparable operating result by €63 million over a rolling 12 months, after hedging.
Norwegian Air Shuttle's third-quarter report for the period ended Sept. 30 showed coverage for about 55% of expected fuel use through the rest of 2026 and about 25% for 2027. The report's cost breakdown put fuel at 35% of third-quarter group operating expenses under its stated measure. Norwegian's calculation put the 12-month cost effect of a 10% fuel-price rise at NOK 677 million after cash-flow hedges. It also cut planned production for the first quarter of 2027 by more than 5%, citing a recent fuel-price increase and the cancellation of winter flights to Dubai.
Ryanair's filing recorded positions as of June 30, with hedges covering 80% of FY27 fuel needs at about $67 a barrel and 15% of FY28 needs at $85. Reuters reported in September that Ryanair had stopped adding hedges. Reuters also reported that Ryanair CEO Michael O’Leary forecast fare increases of 15% to 20% as European airlines head into summer 2027 with less fuel-price cover.
AirAsia Group Berhad said its average jet-fuel price was $183 a barrel in the quarter ended June 30, while fuel expenses rose 58% year over year. The company said dynamic fare changes and lower nonfuel costs offset about 70% of the added fuel expense; average fares in May and June were more than 20% above year-earlier levels. In a September update, it said Thai AirAsia had hedged 13% of its third-quarter fuel use at $89 a barrel.
Passengers have not accepted every fare increase. Reuters reported Norwegian Air Shuttle CEO Geir Karlsen said the airline rolled back some increases after customers balked. Finnair has scheduled its next financial statement for Feb. 17, 2027.
