Spirit Airlines Faces Potential Liquidation

Spirit Airlines, the major U.S. budget carrier, faces potential liquidation as early as this week amid soaring jet fuel prices triggered by the ongoing U.S.-Iran war, sources familiar with the matter said. The development could disrupt operations and strand thousands of passengers nationwide, with the airline still flying hundreds of daily routes but under intense financial pressure.

The carrier, which operates from hubs including Fort Lauderdale and Detroit, filed for Chapter 11 bankruptcy protection in August 2025, its second such filing in less than a year after an initial one in late 2024. Spirit had reached an agreement with creditors to emerge from bankruptcy by early summer, slashing billions in debt and reducing its fleet from over 200 aircraft to about 80 by the third quarter. However, the plan now appears jeopardized as creditors question the airline's ability to meet upcoming payments.

The crisis stems from a sharp rise in jet fuel costs following U.S. and Israeli strikes on Iran in late February 2025, which prompted Tehran to effectively close the Strait of Hormuz, a vital waterway handling roughly 20 percent of global oil shipments. Jet fuel prices have more than...