PHP wrong date/time

Reading PHP manual seems that behaviour of date.timezone is affected by settings in php.ini. There is another way to set the default timezone in all date/time function and it's the date_default_timezone_set. Try to set it with:

date_default_timezone_set('Europe/Riga');

instead of your date.timezone code.

The problem looks similar to what I have seen on one of my servers. Looks to like bug in php 5.3.2-1. Try to run the php script in the bug report and post your results.