IAG Cuts 2026 Profit Outlook on Fuel Costs

International Airlines Group, the parent company of British Airways, Iberia, Vueling and Aer Lingus, warned on Friday that its annual profit for 2026 will fall below earlier expectations due to surging jet fuel costs from the ongoing Middle East conflict. The London-based carrier, which reported first-quarter results for the period ending March 31, projected a roughly 2 billion euro increase in its full-year fuel bill, pushing total spending to about 9 billion euros.

The conflict, which began in late February with escalating tensions involving the United States, Israel and Iran, has driven up oil prices and disrupted supplies through the Iranian-controlled Strait of Hormuz. This key shipping route, vital for refined jet fuel shipments particularly to Europe and Asia, has been blockaded for weeks, exacerbating global aviation pressures. IAG, however, stated it faces no fuel availability issues in its main markets, thanks in part to hedging about 70 percent of its needs at pre-conflict prices and investments in self-supply at its hubs.

Chief Executive Luis Gallego said the group expects to recover around 60 percent of the added fuel costs, or about 1.2 billion euros, through...