
Audio By Carbonatix
Ryanair's profits have fallen sharply as war in the Middle East sent jet fuel prices soaring and customers were reluctant to book flights.
The Irish airline's pre-tax profits dropped 34% to €593m (£503m) between April and June while sales were flat as the company was forced to cut fares to stimulate demand.
Ryanair also said it expects summer fares to be slightly lower than last year due to "consumer hesitancy" around air travel.
The price of fuelling a plane has jumped since the US and Israel launched strikes against Iran in February, and while Ryanair said it had "hedged" or struck deals for most future fuel costs, those not included in these arrangements had more than doubled.
Crude oil prices hit $90 (£67) a barrel for the first time in a month on Monday, before falling back slightly, after a weekend of intense exchanges of fire between the US and Iran.
Traffic through the Strait of Hormuz — an essential route for global oil and gas supplies — has ground to a halt.
An interim peace deal last month brought some respite to oil and energy prices, but they spiked again as negotiations broke down and fighting resumed.
The airline warned that its results for the year will be "highly sensitive" to external factors such as conflict escalation in the Middle East and Ukraine as well as the price of unhedged jet fuel.
Fares for the key summer period between July and September are on track to be "modestly" lower than last year, with many passengers booking closer to departure than normal.
The firm's finance chief, Neil Sorahan, said flights on its popular Mediterranean routes were still full. "People [are] as keen to get away as ever, albeit booking just a little bit later," he said.
Between April and June, Ryanair's revenue ticked up 1% to €4.4bn.
While passenger numbers rose 6% to 6.1 million- helped by the Easter holiday in April - fares fell by 6% as the airline reduced fares to entice flyers concerned about the Iran war.
Ryanair's share price fell 5% on Monday.
Russ Mould, investment director at AJ Bell, said Ryanair was in a better position than many of its rivals, but nonetheless "visibility is worse than San Francisco airport when the fog sets in".
"The renewed escalation in hostilities in the Middle East is unhelpful and without a lasting resolution, challenging times for the airline and travel space look set to continue."
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