So, how did Latvia’s national airline end up in a U.S. bankruptcy court?
The short version is that airBaltic has been squeezed from several directions at once. Rising fuel prices have surely played a crucial part, with airBaltic having sold its remaining fuel hedges earlier this year, leaving it exposed to the spot market as prices surged. The airline’s court filings say it sold the hedges in March to avoid breaching liquidity requirements, leaving its fuel needs for much of the rest of 2026 exposed to market prices. Those prices subsequently skyrocketed after the war between the U.S. and Iran broke out earlier this year.
The Latvian carrier, which historically benefited greatly from shuttling travelers between the Baltics, Russia and Western Europe through its efficient base in the capital Riga (EVRA/RIX), also saw several profitable routes disappear after Russia’s invasion of Ukraine.
Let’s not forget Covid. Like virtually all airlines aimed at hauling human beings (cargo airlines in general fared better), airBaltic took a monstrous hit while humanity added the word “quarantine” to their Scrabble collection. As a side note, the airline management didn’t sit idle during the pandemic. Rather, it accelerated the shift to an all Airbus A220-300 fleet that it also acted as launch operator of. While the aging fleet of Boeing 737-300 and 500’s was mostly decimated at the time, this decision saw the airline wave goodbye faster than most expected to the sizeable number of Bombardier Dash 8 Q400 that served the bread-and-butter routes linking the Baltic capitals together.
Last, but certainly not least, Pratt & Whitney’s geared turbofan engine problems acutely affected airBaltic’s operations. The airline’s shift to an all-A220 fleet left it exposed to grounded aircraft and long maintenance windows due to supply chain disruptions. In 2024, engine shortages kept an average of eight aircraft out of service, peaking at 13 in the fourth quarter, and forced the airline to lease aircraft and crews from other operators during the peak summer season when it would normally be operating many wet-lease flights on behalf of other carriers. In 2025, AirBaltic canceled more than 4,000 flights during the summer season and suspended or reduced frequencies on 40 routes.
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