Budget airline Ryanair has said it could lose up to £47.4m this year due to the impact of rising fuel prices.

The low-cost carrier said net profit had fallen by 85% in the three months to the end of June, but despite this it added it would carry on reducing fares and had no plans to introduce a fuel surcharge.

Chief executive Michael O'Leary said the company hoped to break even in the year to March 2009 but acknowledged it could lose as much as 60m euros.

"The outlook for the remainder of the fiscal year, which is entirely dependent on fares and fuel prices, remains poor," he said.