Another airline shuts down and cancels all flights over fuel crisis

While jet fuel prices have come down slightly from highs seen during the spring, the sustained highs caused by the war with Iran have already dealt the final blow to multiple small airlines.

The most high-profile airline collapse occurred when low-cost carrier Spirit Airlines was unable to emerge from two bankruptcies filed prior to the jet fuel crisis and shut down for good at the start of May. Mexican holiday airline Magnicharters filed for bankruptcy protection in Mexico City in May while British cargo carrier European Cargo entered administration at the start of June.

Earlier in the year, Maldives-based BeOnd shut down for the summer amid the high cost of jet fuel and security situation at its main Dubai base but is still selling flights for later in 2026.

Air Oceania suspends operations amid jet fuel shortage

Airlines in remote parts of the world are particularly affected when jet fuel becomes unaffordable or impossible to access. Launched out of the French overseas territory of New Caledonia in May 2025, Air Oceania has just been getting started serving the remote collection of islands in the Pacific Ocean with charter and medical flights connecting the Loyalty Islands group to the Grande Terre mainland.

It was initially launched as Air Loyauté but later rebranded to the current name.

Related: Bankrupt airline now has 'last chance' to survive

"Air Oceania is the territory's airline, serving the Loyalty Islands with direct inter-island flights as well as Wallis and Futuna," the airline writes on its website in translation from French. "The airline has deliberately focused its operations on staying closely attuned to the concerns and needs of the population."

As is being reported by Swiss outlet ch-aviation, Air Oceania suspended its flights to Nouméa Magenta Airport (GEA) and Ouanaham Airport (LIF) over a lack of jet fuel. The suspension has not been confirmed by the airline itself and is reported to be temporary in the hopes of restarting operations once the situation improves.

The Air Oceania fleet includes one 19-passenger De Havilland DHC-6 Twin Otter turbobprop plane and an 11-passenger Tecnam P2012 twin-engine piston aircraft. It is also listed as having between 50 and 200 employees.

"The company’s staff, aware of the importance of their role and responsibilities, take pride in contributing to the well-being of the Caledonian population through their daily tasks and duties," Air Oceania writes.

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The main airline serving New Caledonia, Air Calédonie, sought bankruptcy protection from a local court earlier in the spring. The airline had been unable to run any flights after its decision to move its base from the capital city of Nouméa to a smaller airport more than 50 miles away was met with protests that blocked access to airfields for weeks.

These airlines filed for bankruptcy in 2026:

• Spirit Airlines: The largest airline shutdown of the year occurred when Spirit Airlines canceled all remaining flights on May 2. Although the airline had filed for Chapter 11 protection twice before, the skyrocketing price of jet fuel dealt the final blow to its operations.
• Magnicharters: The Mexican low-cost airline canceled all of its flights until May 2026 in a shutdown that left thousands stranded.
• Starflite Aviation: Houston-based Starflite Aviation had its AOC license revoked in March 2026, amid FAA claims that owners falsified pilot training records to bypass safety audits.
• AlpAvia: Slovenian charter airline AlpAvia also shut down in March 2026 over financial problems.
• H-Bird: Charter airline H-Bird was declared bankrupt by a Swedish judge after losing its operating license at the end of 2025.

Related: Another airline files for bankruptcy protection, cancels flights