UAE holiday travellers face higher airfares as global airlines warn of price hikes

Dubai: UAE residents planning overseas trips for the December holidays face growing pressure on travel budgets as airlines worldwide warn of higher ticket prices, with soaring jet fuel costs forcing carriers to reconsider fares, flight schedules and operating expenses.

Europe's largest airline by passenger numbers, Ryanair, has become the latest to sound the alarm, warning that airfares across Europe could rise by as much as 20% next year if elevated fuel prices persist. The warning comes as US holiday airfares have already climbed to their highest levels in a decade, according to travel booking platform Hopper.

For UAE residents planning to visit family or take holidays abroad, the developments make it increasingly important to compare fares, consider alternative travel dates and account for additional charges before booking.

The pressure is not limited to one region. Airlines in Europe and the US are grappling with higher fuel bills, while some carriers are reducing flight capacity or reviewing costs to protect profitability.

The warnings do not mean every international flight from the UAE will become more expensive by the same percentage. Ticket prices depend on the destination, travel dates, airline capacity and demand. But the latest industry figures show why travellers could face fewer affordable options on some routes.

Double-digit fare hikes in Europe

Ryanair chief executive Michael O'Leary said on Monday that European airlines could impose double-digit percentage fare increases in 2027 as existing fuel hedging agreements expire and carriers become exposed to higher market prices.

"We're certainly looking at double-digit (percentage) fare increases across Europe from all airlines in 2027," O'Leary said in a video accompanying the company's quarterly earnings.

In a separate CNBC interview, he said European ticket prices could climb as much as 20% next year.

Ryanair expects its annual fuel bill to increase by approximately €2 billion ($2.24 billion) in its next financial year. The airline has already reduced its winter flight schedule and is considering further cost-saving measures, including temporary pay freezes and greater use of artificial intelligence in administrative operations.

"Unless there is a swift resolution of the Middle East conflict, we expect jet-fuel prices to remain elevated well into 2027," O'Leary said in the company's earnings statement.

The carrier reported a 6% decline in second-quarter net profit to €1.61 billion, despite a 4% increase in revenue to €5.7 billion. Passenger traffic grew 5%, but average fares fell 2% amid weaker consumer confidence and later bookings.

The warning is particularly relevant for travellers planning European holidays because Ryanair operates an extensive network of short-haul flights across the continent, including services used for onward journeys between European destinations.

Flight prices are under pressure

Jet fuel prices have risen sharply since the outbreak of the Middle East conflict, creating one of the biggest cost challenges for airlines.

According to the International Air Transport Association (IATA), global jet fuel averaged approximately $99 a barrel on February 27, before more than doubling to $209 in early April. Prices subsequently eased before climbing again to about $195 in mid-September.

The latest figure cited in the industry data puts the global average near $196 a barrel, almost twice the pre-war level.

IATA expects fuel to account for nearly one-third of airline operating expenses this year, compared with about a quarter in 2025.

Some airlines initially avoided the full impact because they had purchased fuel in advance at fixed prices, a practice known as hedging. Those agreements are now becoming a concern as they approach expiry.

Ryanair, for example, has secured 80% of its fuel requirements for the financial year ending March 2027 at approximately $67 a barrel. For the following financial year, only 25% is hedged, at around $95 a barrel.

As those lower-cost agreements expire, airlines may have to purchase more fuel at prevailing market prices.

Dan Coatsworth, head of markets at AJ Bell, said airlines had been protected by fuel hedging agreements but could face significant cost increases as those contracts expire.

"Travellers should brace themselves for a sharp increase in the cost of flying unless oil prices fall substantially," Coatsworth said.

US airfares hit decade highs

The impact is already evident in the United States, where domestic airfares for Thanksgiving and Christmas have climbed to their highest levels in 10 years, according to Hopper's September 2026 Holiday Travel Index.

Average return fares for Thanksgiving have reached $402, up 31% from last year, while Christmas flights average $452, an increase of 23%.

"Airfares right now are at what we see as a 10-year high because of the high cost of jet fuel," Hayley Berg, lead economist at Hopper, told NPR in October.

Hopper also reported higher international fares, including a 15% year-on-year increase for Christmas travel from the US to Europe and a 23% increase for Mexico and Central America. These figures relate to departures from the US, rather than flights originating in the UAE.

Higher fuel costs are also influencing airline schedules. Carriers have reduced some less profitable flights, potentially limiting the number of seats available during busy holiday periods.

Fliers change travel plans

Rising airfares are already changing how some travellers plan their holidays.

A survey released by Hertz on October 29 found that six in 10 US respondents planning holiday trips were more likely to drive because of higher flight prices. Among those planning Thanksgiving travel, 37% said they were choosing road journeys instead of flying to save money.

Hertz also reported a 16% year-on-year increase in advance Thanksgiving car rental reservations and a 7% rise for Christmas and New Year.

While these findings concern US travellers, they illustrate how rising ticket prices can influence decisions about destinations, transport and holiday budgets.

For UAE residents travelling to destinations such as Europe, India, Pakistan or Southeast Asia, the practical options will depend on the route. Travellers with fixed dates may have less flexibility, while those planning holidays across several destinations can compare alternative airports, connecting flights and different travel periods.

How to manage travel costs

The most immediate consideration is timing. Hopper's research shows that even changing departure or return dates by a day or two can make a substantial difference to holiday airfares.

"We're definitely seeing travelers already change their behavior, primarily booking earlier," Berg said in an October 29 interview with Yahoo Finance.

Berg explained that Hopper had observed an unusually high share of holiday bookings in September, rather than the more typical October period, as travellers sought to secure fares before prices climbed further.

For US domestic Christmas travel, the booking platform identified December 18 to 20 as among the most expensive departure dates, while Monday and Tuesday departures immediately before Christmas were comparatively cheaper. Returning on December 27 was also more expensive than returning earlier in the week.

Although those findings cannot be applied directly to UAE departures, the underlying approach offers a practical way to compare holiday fares.

Compare full cost of tickets

Travellers can also compare the full cost of tickets rather than the advertised base fare. Baggage allowances, seat selection, airport transfers and charges for changing flights can alter the final price, particularly when comparing full-service and low-cost airlines.

Those planning multi-city holidays should consider whether separate tickets or a single itinerary offer better value, taking into account the additional risks and costs of missed connections.

Price alerts can help travellers monitor fares before booking, while comparing nearby departure dates and alternative airports may reveal cheaper options.

Booking early does not guarantee the lowest fare. The more useful approach is to establish a realistic budget, compare available prices and secure tickets when an acceptable fare appears, particularly for trips with fixed school holiday or family commitments.

Can airfares rise further in 2027?

The latest warnings suggest the pressure on airfares may extend beyond the coming holiday season.

Ryanair expects fuel costs to remain elevated into 2027 unless the Middle East conflict is resolved quickly. Its estimate of a €2 billion increase in next year's fuel bill illustrates the financial challenge facing airlines as cheaper fuel contracts expire.

The airline's warning of double-digit fare increases concerns European short-haul travel in 2027, not a confirmed increase across all international routes this December.

For UAE residents, the immediate concern is the cost of overseas travel during the November and December holiday period. The evidence from the US and Europe points to significant pricing pressure, but the size of any increase on UAE routes will depend on individual airlines, destinations and available capacity.

With fuel costs remaining high and airlines reviewing their schedules, travellers who have yet to book may benefit from comparing their options sooner rather than relying on last-minute discounts.