Ryanair warns airfares will rise and budget carriers will go bust if fuel prices stay high — should you squeeze your bucket list trip in now?

Oil prices jumped back up, after a brief respite — with jet fuel nearing a whopping $140 a barrel.

“If high oil prices continue through to summer 2027, Ryanair believes short-haul air fares in Europe will increase materially to reflect higher oil prices, as some less well-hedged competitors will struggle to maintain capacity or even survive this coming winter season,” the Irish airline stated in its August 2026 traffic stats.

While higher airfares put some strain on vacation plans this summer, many Americans were still determined to travel. But what does that mean for your winter vacation, and should you book that bucket-list trip now?

How airlines are dealing with higher jet fuel prices

The global average jet fuel price is 74.2% higher than last year’s average (as of the week ended Aug. 28), according to IATA. And the average jet fuel price, as of Sept. 2, sat at $4.16 a gallon, according to the Argus US Jet Fuel Index.

Rising fuel prices are a problem, but so is market volatility. That’s why some airlines buy a certain amount of jet fuel at a fixed price for a later delivery — a concept known as fuel hedging.

These airlines are ‘hedging’ their bets: Prices can go up (as we’ve seen), but they can also fall.

Ryanair (Nasdaq:RYAAY**)** happens to be one of the most hedged airlines. About 80% of its fuel costs are hedged at $67 a barrel. That means the remaining 20% — which is unhedged — is exposed to higher prices.

In light of high unhedged oil prices, “it is sensible to strategically reduce the group’s exposure to unhedged jet fuel during the unprofitable winter schedule (from November to March),” Ryanair stated.

Reducing its exposure means cutting winter traffic targets by about 2 million passengers.

Other airlines that hedge their fuel prices include easyJet, Air France-KLM and Lufthansa. This can help to protect passengers from sudden price hikes (versus unhedged carriers), though it’s no guarantee.

Among the most exposed — which means zero to minimal hedging — are American Airlines, United Airlines, Southwest Airlines and Delta Air Lines. Delta owns and operates an oil refinery, which provides some degree of non-traditional hedging.

Of the Big Three airlines in the U.S. (American, United and Delta), each “faces on the order of $400 million in additional monthly fuel cost,” according to DWU Consulting.

And those additional costs could be passed down to customers in a few different ways.

Airlines that haven’t hedged their winter fuel might be forced to raise ticket prices. Already, many have rolled out fuel surcharges, ranging from $25 to more than $60.

They might also continue to cut routes and flight frequencies, particularly in off-peak destinations. For low-cost carriers, it can be cheaper to park aircraft in instances where ticket revenue wouldn’t cover the cost of fuel.

That means there are fewer choices available and higher demand for remaining seats, which could also serve to keep airfares elevated.

The longer this situation continues, the higher the risk of airline bankruptcies. Already, we’ve seen ultra-low-cost carrier Spirit Airlines shutter its operations in May following two bankruptcies.

What does this mean for your next vacation?

Despite rising costs, Americans are still traveling — though, in some cases, they’re adapting their plans, like traveling closer to home rather than overseas.

“Higher fuel costs, airspace disruptions and longer routings are weighing on growth, yet underlying willingness to travel has not collapsed, only moderated,” according to IATA’s June 2026 Global Outlook for Air Transport. Passenger traffic is forecast to grow by 2.1% in 2026, “a material slowdown from recent years.”

If you’re looking toward holiday travel, a winter vacation or a bucket-list trip, booking sooner rather than later can help you avoid fare increases if jet fuel prices remain elevated.

It’s typically recommended that you book a month or two in advance of domestic travel and three to five months in advance of international travel, according to The Points Guy. But this year is different, with so much uncertainty surrounding the war in Iran.

“Travelers planning holiday trips should start actively tracking prices now rather than waiting for the historical booking window. If you see a fare that fits your budget, book it,” recommends The Points Guy.