49er

I had booked Vueling 8953 BRU-FCO for this coming Saturday for our family of four. I bought it through Iberia as a codeshare. I checked it on the Vueling site today and found out it has been cancelled due to the fire at FCO. I had already checked in for the flight.

My options seem to be
1) Ask Vueling (or Iberia) to re-route us on another Vueling/Iberia flight with connection in BCN. This will double the travel time, make us arrive later than planned, but presumably not cost us more money than the Eur 160 we paid (total for 4). On the downside, there is an air traffic controller strike in Spain, though according to the Vueling site, June 13 is not one of the strike dates. Not sure if this is a good option due the strike issue.

2) Ask for a refund and then buy a ticket on another carrier. Alitalia and Brussels Air have this route non-stop for Eur 250/p (Eur 1000 total), which is a lot more money obviously

Any other options I should consider? The train would take too long.

Indelaware

You could ask IB to put you on BA BRU-LHR-FCO. or AY BRU-HEL-FCO. IB, BA, & AY have common ownership; it is to IB's advantage not to put you onto a third carrier.

You could ask IB to put you on AZ or SN nonstop service BRU-FCO. I am not certain if they are required to do so under EU regs, but you should certainly review your rights.

Often1

It is unclear that they must rebook on other carriers, but it ought to be relatively cost-free for them to do so.

I would do the research and propose the specific reroute you want and have the next best alternatives in hand. It is always better to make a specific request than to rely on an agent to figure out what you might want.

The FCO fire will be an "extraordinary circumstance" so compensation itself won't happen.

Indelaware

Another option might be to have them reschedule your trip to the evening before.