Hong Kong-based low-cost airline Oasis has gone into liquidation, cancelling all of its flights.

Chief executive Stephen Miller told a press conference: "It is with great regret that Oasis Hong Kong Airlines has today voluntarily applied to the Hong Kong courts to appoint a liquidator."

Oasis launched in October 2006, flying daily from London Gatwick to Hong Kong, and then added flights from Hong Kong to Vancouver.

Cathay Pacific has stepped in to help stranded passengers.

"We sympathise with the many passengers in Hong Kong, London and Vancouver who have been stranded by the Oasis' decision, and we will do our very best to help them through this difficult and stressful period," said chief executive Tony Tyler.

"We hope our contingency arrangements can accommodate as many as possible of the school children affected, and take people home who have been stranded by the closure."

He said the demise of Oasis underlined the "tough and competitive nature of the international aviation business, particularly at a time of record high fuel prices and global economic uncertainty".

Special ticketing arrangements have been made to help Oasis customers who had confirmed bookings on the airline over the next two weeks, effective up to and including April 23.

A special one-way Economy Class fare of £160 will be offered to eligible Oasis ticket holders on the London to Hong Kong route.

Cathay has set up a hotline on 0208 834 8893 for passengers to get details of special ticketing arrangements.

Details can also be found at www.cathaypacific.com

"We will be doing our utmost to help people out, and will certainly do everything in our power to co-operate with the HKSAR Government and other carriers to minimise the impact on the travelling public" said Tyler.