According to Investing.com, shares of British Airways’ parent company IAG, as well as Air France-KLM, Lufthansa, Wizz Air and Ryanair lost between 1.47% and 2.1% by the middle of trading. Shares of easyJet looked more stable, down 0.86%.
According to the updated IATA forecast, the total net profit of the global aviation industry in 2026 will amount to $23 bln. This is almost half of the expected $45 bln by the end of 2025 and significantly lower than the previous forecast of $41 bln.
The association estimates the industry’s net margin will shrink to 2%, down from 4.2% a year earlier. Profit per passenger will drop from $9.10 to $4.50.
“Profits will fall from $45 billion in 2025 to $23 billion this year. And margins will fall from 4.2% to 2.0%,” said IATA CEO Willie Walsh. He said such low profitability underscores the industry’s vulnerability to external shocks.
Aircraft fuel costs to rise by 40%
Fuel costs remain a key pressure factor. IATA expects the average price of jet fuel to reach $152 per barrel in 2026, almost 70% higher than last year’s level. The forecast is based on an average Brent crude oil price of $95 per barrel.
Against this background, airlines’ fuel costs could rise by 40% to $350 billion against $252 billion in 2025. The share of fuel in the structure of operating expenses will increase to 31.4% from 25.4%.
Despite global revenue growth of 9.4% to $1.165 trillion, costs will grow even faster. Total industry operating costs are projected to reach $1.117 trillion.
Profit per passenger will fall to $7.30
The deterioration will be especially pronounced for European carriers. Net profits of the region’s airlines could fall to $9.6 billion dollars, down from $13 billion a year earlier. Net margins will fall to 3.1% and profit per passenger will drop to $7.50 versus $10.30 in 2025.
IATA notes that European airlines have fixed about 70% of their fuel requirements in advance through hedging. However, as these contracts expire, the impact of high fuel prices will increasingly affect financial results.
Middle East aviation prepares for losses
The most severe impacts are expected in the Middle East. The association estimates that air carriers in the region could go from a net profit of $7.2 billion in 2025 to a loss of $4.3 billion next year. At the same time, passenger traffic in the region could fall by 11.4%.
Profit declines are projected in other major aviation regions as well. North American airlines may earn $9.4 billion versus $12.4 billion a year earlier, while carriers in the Asia-Pacific region may earn $6.6 billion versus $9.8 billion.
IATA expects that 5.1 billion passengers will use airlines’ services in 2026, and the average seat utilization rate will reach a record 84%.
