Thousands of passengers who had booked flights with Iceland's low-cost Wow Air have been left stranded after the airline suddenly stopped flights on Thursday, offering passengers no recourse other than to book another flight with a rival carrier and try and get their money back from their credit card company or travel agent.

According to the BBC, the airline released a statement on its website saying it would cancel all scheduled flights and cease operations immediately. It recommended that customers with urgent travel needs try and book with other airlines, which might be willing to offer a reduced "rescue" fare. Wow said it would published information about these fares when it becomes available.

BREAKING: WOW Airlines ceases operations and cancels all flights; stranding passengers around the world. Airline advises passengers to search for rescue fares with other carriers. pic.twitter.com/5Q8HWnfoOc — Sam Sweeney (@SweeneyABC) March 28, 2019

Any passengers who didn't buy their tickets via a protected booking method could be entitled to compensation "in accordance with European regulation on Air Passenger Rights" or by filing a claim "in case of a bankruptcy."

However, a bankruptcy wasn't a foregone conclusion, as the airline said it would resume operations after an equity deal with a group of investors had been finalized. Though we imagine the uproar over the cancellations could be a deal breaker. On March 24, Wow announced that a deal with rival Icelandair would not materialize, so it's unclear who these other investors might be.

While Wow's customers were left in the lurch, Icelandair shareholders benefited from the catastrophe as the rival airline's shares surged nearly 30%. One passenger who had been stranded at an airport in Frankfurt with his family spoke with an FT reporter about his group's struggle to book new flights.

Christian Luisi, 22, said he and nine other members of his family were stranded at the airport in Frankfurt after their Wow Air flights to the US via Keflavik airport in Iceland’s capital were cancelled this morning. He said his grandparents had “just paid thousands of dollars for tickets” to cover tickets back to the US for half the group, while the rest were attempting to find affordable flights. Mr Luisi, who works as a supermarket manager in New York, said this was the first foreign holiday he had been on since he was eight years old. “I didn’t imagine anything like this could ever happen,” he said. "The entire morning has been terrifying and stressful. I just can’t believe they’ve left us stranded." Mr Luisi showed an automated text message sent by Wow Air at just after 6am on Thursday that stated the family’s flight was cancelled because of "operational restrictions." The automated message also informed passengers that they could choose between a full refund and changing their reservation to the next available flight. After receiving the messages, Mr Luisi said, the family “checked out of our hotel, returned the rental car and went to check in”, he said. Mr Luisi said that, when he went to the designated Wow Air check-in desk at Frankfurt airport, "no one from Wow Air was there and of course there were no other Wow Air flights." He said members of his group were then handed a paper note by a Frankfurt employee, a photo of which he shared with the Financial Times, signed in the name of Wow Air operations controller Andri Hrafn Armannsson. The note also informed passengers they could have a full refund or alternative flight.

According to Bloomberg, all 29 of Wow’s scheduled flights were canceled, leaving 2,700 passengers to try and find flights with other airlines. The government activated contingency plans and issued a statement seeking to offer reassurances about the consequences for the local economy.

In a letter to employees, Wow's founder and chairman, once hailed as one of the country's savviest businessmen, apologized for not taking action sooner.

“We have run out of time and have unfortunately not been able to secure funding for the company,” Chairman Skuli Mogensen said in a letter to employees. “I will never be able to forgive myself for not taking action sooner.”

While the cancellations elicited a torrent of outrage from stranded fliers, the airline's sudden closure wasn't entirely unexpected. Earlier in the week, creditors had reportedly seized Wow planes due to its financial difficulties, while dozens of flights had been cancelled earlier in the week.

According to the FT, the lossmaking carrier had suffered from falling tourism to Iceland as well as a rise in oil prices, which raised its fuel costs. In addition, more rival airlines had been offering low-cost long-haul flights, which had been a crucial business for the airline.

In a sign that Wow's failure could have wide-ranging implications for Iceland's economy, a government task force's analysis published late last year found that, were Wow to collapse, it could trigger a 3% contraction in GDP for the Icelandic economy, as well as a steep drop in the Krona that would cause inflation to climb by as much as 6%. Meanwhile, exports could drop by 10%. The study had been ordered to examine the risks from a slowing tourism industry.

This could lead to the biggest economic contraction since Iceland's economy collapsed during the financial crisis.