Slump in oil prices should enable Ryanair to break even this year

A slump in oil prices during the past two months should see Ryanair break even this financial year after it had earlier predicted a loss of up to €60m, chief executive Michael O’Leary said yesterday.

Speaking at the airline’s annual general meeting in Dublin, Mr O’Leary told shareholders that as long as oil prices remain under $100 a barrel for the remainder of the year the low-cost carrier should break even.
His comments initially sent shares in the carrier soaring over 9pc, but they fell back later and closed down slightly at €2.52.

Mr O’Leary cautioned investors that lower oil prices would not necessarily deliver a profit this year as the company plans to use fuel savings to boost passenger numbers by offering cut-price ticket deals.

He added that if oil remained under $100 a barrel during 2009 it could herald a return to “substantial profitability” in the next financial year. He also said that lower fuel prices could reduce its operating costs by around €300m in 2009. However, kerosene prices have risen recently despite a fall in oil.

Irish Independent