Spirit Airlines is facing the possibility of liquidation as early as this week, according to sources familiar with ongoing discussions between the budget carrier and its creditors. The airline's financial distress has intensified amid rising jet fuel prices that are complicating its ability to emerge from bankruptcy proceedings.

The discount airline has been engaged in restructuring talks with creditors as it seeks to address mounting financial pressures. These discussions have included the potential for complete liquidation of the company's assets, sources indicated. The carrier's bankruptcy exit strategy remains uncertain as fuel cost increases continue to impact the aviation industry.

Spirit Airlines has been operating under financial strain for months, with the company's low-cost business model facing challenges from both operational costs and market competition. Rising fuel prices have particularly affected budget carriers like Spirit, which operate on thin profit margins and are more sensitive to cost fluctuations than legacy airlines.

The potential liquidation would mark a significant development in the airline industry, as Spirit has been one of the largest ultra-low-cost carriers in the United States. The company's fate will depend on ongoing negotiations with creditors and its ability to demonstrate a viable path forward despite the challenging operating environment.