British Airways parent says Mideast war to hit annual profits

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AG, parent group of British Airways and Spanish carrier Iberia, said Friday that the Middle East war will lower its annual profits despite a strong start to 2026.

"Whilst the first quarter was relatively unaffected by the Middle East conflict we expect it to have a more substantial impact throughout the rest of the year as the increase in the fuel cost starts to manifest itself," IAG said in an earnings statement.

"As a result we expect our profit to be lower than originally anticipated at the beginning of the year."

Oil prices have soared since the start of the US-Iran war in late February, resulting in much higher jet fuel costs.

IAG, owner also of Irish airline Aer Lingus and Spanish carrier Vueling, said net profit surged 71 percent to 301 million euros ($354 million) in the first quarter compared with the January-March period last year.

Revenue grew 1.9 percent to 7.18 billion euros.

Chief executive Luis Gallego said the improvements reflected strong passenger demand.

"We are actively managing the uncertainty created by the fuel price increase and its impact," he said in the earnings statement.

"We currently see no issues with fuel availability in our main markets," Gallego added.

IAG's net profit last year jumped 22 percent to 3.34 billion euros thanks largely to lower fuel costs. The company typically does better in the second half of the year owing to the peak summer season.