IAG, the owner of British Airways, Aer Lingus and Iberia, warned that the Iran‑Israel conflict will add €2bn to its jet‑fuel bill this year. The group said the war will have a substantial impact on earnings after posting a 77 % jump in first‑quarter pre‑tax profit. Shares slipped 4 % in early trading on Friday following the release.

About 70 % of the year’s jet fuel is hedged, but total fuel expense is now projected at €9bn, up from €7bn previously forecast. IAG aims to recover roughly 60 % of the extra cost through operational savings and fare increases, cushioning the blow to its bottom line.

CEO Luis Gallego said the airline’s supply chain and inventory give it confidence in jet‑fuel availability throughout the summer, stressing the issue is price, not shortage. He warned that prolonged restrictions on Middle‑East crude and fuel flows could trigger global supply constraints. Q1 pre‑tax profit rose to €422m from €239m, while revenue edged up 1.9 % to €7.2bn and passenger traffic grew less than 1 %.

The group withdrew its full‑year profit guidance in February and trimmed capacity growth targets, scaling back from a 3 % increase to 1 % in Q2 and 2 % in Q3. With fuel costs now driving total expenses toward €9bn, margins will feel pressure despite planned cost‑saving measures. Investors must weigh the earnings hit against the airline’s strong cash position.