The parent company of British Airways has issued a profit warning and said it expects to spend about €2bn (£1.72bn) more on fuel than planned this year due to the Iran war.

International Airlines Group (IAG), which also owns Aer Lingus, Iberia and Vueling, said it has hedged 70% of its expected fuel use for this year with costs expected to be about €9bn, up from previous forecasts of €7.1bn.

The company said that it expects to recover about 60% of the higher fuel costs this year through “revenue and cost management actions”.

“We are actively managing the uncertainty created by the fuel price increase and its impact, taking the necessary action on yields, costs and capacity,” said Luis Gallego, chief executive of IAG. “The impact of the higher fuel price will inevitably lead to lower profit this year than we originally anticipated.”

Global oil prices have reached peaks of $126 a barrel as the conflict continues to weigh on markets, having stood at $72 just before the conflict began. On Friday, oil was trading at just above $100 per barrel.

Speaking as IAG reported on first-quarter trading, Gallego added that IAG is not currently seeing any issues with fuel availability in its main markets, and is confident about fuel availability through the peak summer period.

However, across the industry 2m airline seats have been cut from this month’s schedules as airlines redraw their operations because of soaring jet fuel prices, according to data released earlier this week by Cirium.

About 13,000 fewer flights will operate in May around the world after recent cancellations.

However, only a net 111 flights have disappeared from schedules at London Heathrow, British Airways’ main base.

It comes amid fears that shortages of jet fuel could cause further summer cancellations, with UK airlines told at the weekend they could have more flexibility to consolidate flights on popular routes if needed.

International agencies have predicted that Europe faces shortages of jet fuel if the war in the Middle East continues to disrupt supplies.

“If the current conflict continues to restrict flows of both crude oil
and jet fuel from the Middle East, there is the potential for supplies of jet fuel to be restricted on a global basis,” IAG said.

The company said it was working with governments on the problem.

Analysts at Goldman Sachs said in a research note on Monday that the UK was the most exposed as the largest net importer of jet fuel in Europe, with a low inventory, high import reliance, and reduced domestic refining capacity for jet fuel.

It said stocks in the UK could fall to “critically low levels, increasing the likelihood of rationing measures”.

IAG said it has seen “strong demand across most of our markets” but “softer demand” in the eastern Mediterranean.

The company reported a pre-tax profit of €422m during the three months to the end of March, up 77% on the same period a year earlier. Revenue rose 1.9% to €7.2bn.

Shares in IAG fell nearly 5% in early trading on Friday, making it the biggest faller on the FTSE 100.