The economic crisis and the cost of fuel have forced charter carrier Futura Gael, the Irish wing of Futura International, to go bust.

The travel plans of almost 1,000 holidaymakers were disrupted, although tour operators moved swiftly to ensure none were stranded.

The airline shut down at midnight on Sunday, suspending all flights, and all its aircraft were grounded at Dublin Airport.

Barry Matthews, financial director at Futura Gael, said Futura International is seeking for a new investor to save the company.

The Irish Travel Agents' Association (ITAA) advised holidaymakers not to panic and pointed out that they had booked their holidays with tour operators who would commission other aircraft to take them to their destinations.

Simon Nugent, chief executive of the ITAA, said that since consumers had booked with licensed and bonded travel operators rather than directly with Futura Gael they would not be left "high and dry" as happened to some passengers who were due to fly with low-cost carrier Zoom which went into administration recently.

Tour operators who had booked their customers onto Futura flights went into overdrive to find alternative carriers.

Falcon Holidays had planned to send three flights to Costa de Almeria in Spain with Futura on Monday. The groups were to have flown from Cork, Shannon and Dublin.

Falcon resolved that problem by bussing the Cork group Shannon. It then organized a carrier to fly the group from Dublin, stopping off at Shannon to pick up the other two groups.

It also organized alternative aircraft to carry passengers home from Spain to Ireland.

The Thomas Cook Group, which operates the Panorama, Sunworld and Direct Holidays brands in Ireland, said it was sourcing alternative aircraft to ensure that customers currently on holiday could return as scheduled and customers due to fly over the coming weeks would "get the holiday they had planned."

Futura Gael said it had been looking for an investor to secure operations but to no avail. A spokesman said all 70 flight staff were being temporarily laid off.

An investor is still being sought with a view to operating again in the future.

A spokesperson said, "The difficulties faced by Futura Gael are similar to many other companies in the sector and are mainly resulting from the speculative and exaggerated increase in the price of oil in recent months. This issue has placed the Futura Group in a very difficult situation from a financial point of view."

In Spain, the parent company, Futura International Airways, suspended flights for a day on Monday. Spanish government officials gave Futura permission to put planes back up in the air after temporarily suspending their operating license.

Officials said they want to see the details of Futura's new crisis plan by Friday this week before deciding whether to pass, suspend or revoke its flying license.