Key Highlights

  • International Consolidated Airlines Group SA (LSE:IAG) is in focus as Brent Crude fell below $100 a barrel on 4 November 2026 for the first time since early October.
  • The British Airways and Iberia owner reports third-quarter results on Friday, 6 November 2026.
  • Higher fuel costs cut second-quarter adjusted operating profit by 16% to €1.41 billion, and the group now expects flat capacity for 2026.
  • News on this year's Dividend is expected alongside the third-quarter numbers.

Why IAG Is in Focus Today

International Consolidated Airlines Group SA (LSE:IAG) is one of the most closely watched stocks on the FTSE 100 this week. On Wednesday, 4 November 2026, Brent crude dropped to around $99 a barrel from about $103 the previous day, falling below $100 for the first time since early October. The decline followed the Democrats' sweep of the US midterm elections, which raised hopes that further military escalation with Iran could be avoided and that oil Supply routes could normalise.

Fuel is the single largest Variable Cost for airlines, so any fall in oil prices quickly improves the Earnings outlook. IAG shares had already risen 3.1% to 415.2p on Monday, 2 November, when oil fell sharply on hopes of diplomatic progress, and the stock remains highly sensitive to movements in crude and jet fuel prices. The FTSE 100 rose 1.8% on Wednesday, with travel and consumer names benefiting from the improvement in risk appetite.

The timing is significant because IAG reports its third-quarter results on Friday, 6 November. The summer quarter is the most profitable period of the year for European airlines, so the update will give a clear picture of how the group managed the year's fuel shock.

A Tough Year for Fuel Costs

The Middle East conflict pushed oil and jet fuel prices sharply higher in 2026. In the second quarter, IAG's fuel costs rose by close to 25%, cutting adjusted operating profit by 16% to €1.41 billion, although that result was slightly ahead of market forecasts. Revenue was broadly flat at €8.9 billion. In response, the group lowered its capacity plans and now expects flat full-year capacity compared with earlier guidance for growth of just under 3%.

IAG's fuel hedging programme has helped soften the blow by locking in part of its fuel needs at earlier prices. Management has argued that this protects the Business from the short-term impact of large price spikes, though hedges roll off over time.

Demand Picture

Demand for premium and long-haul travel has remained resilient, particularly on North Atlantic routes, where British Airways has a leading market position through its joint business with American Airlines. Leisure Demand across Europe has also been solid. However, IAG has previously flagged softness in US economy-class demand, and higher ticket prices to pass on fuel costs could test consumer appetite. Aer Lingus has faced its own challenges, recording losses in the first half.

Market Context on 4 November

The US midterm result shifted expectations for energy markets. Commentators noted that a unified Democratic Congress could make military escalation more costly for the administration and increase pressure to secure a deal that restores shipping flows through the Strait of Hormuz, which would help normalise crude supply and fuel inventories. For airlines, a sustained fall in jet fuel prices would be one of the most powerful positive catalysts for earnings in 2027. A weaker dollar also helps European carriers because fuel is priced in dollars. Meanwhile, sterling firmed to around $1.346, which affects the translation of British Airways' earnings and the cost of fuel purchases.

Shareholder Returns

IAG returned to paying dividends after the Pandemic and has used Buybacks to return surplus cash. The full-year 2025 dividend totalled €0.098 per share, up 8.9% on 2024. Investors expect news on the 2026 payout alongside the third-quarter results, and any update on buybacks will be closely watched given the hit from fuel costs.

Risks to Consider

Key risks include renewed spikes in oil prices, further disruption to flights in the Middle East, weaker US consumer demand, labour costs, air traffic control disruption and aircraft delivery delays from manufacturers. Currency movements between the euro, sterling and the dollar also affect reported results.

What Investors Are Watching Next

The third-quarter results on 6 November are the immediate catalyst. Investors will focus on operating profit for the summer quarter, unit revenue trends on the North Atlantic, fuel cost guidance for the fourth quarter and 2027, hedging levels and the dividend announcement. Commentary on forward bookings into winter and next summer will shape expectations. Oil price movements and any developments in US-Iran negotiations will continue to drive sentiment toward International Consolidated Airlines Group SA (LSE:IAG).