We are continuing to closely monitor developments across the Middle East and their impact on global supply chains. While recent geopolitical developments initially suggested potential easing of disruptions, the situation has since shifted, with volatility and uncertainty persisting across both ocean and air freight markets.
Below is the latest update outlining key impacts to your shipments and supply chains.
Geopolitical Update – Elevated Risk & Ongoing Volatility
Recent developments indicate that while a temporary ceasefire between the United States and Iran was announced in early April, the situation has since become increasingly unstable.
Subsequent peace talks have not resulted in a sustained agreement, and tensions in the region have escalated again. As a result, earlier expectations of a gradual stabilisation in shipping conditions have not materialised.
Vessel movements through the Strait of Hormuz remain highly restricted and tightly controlled, with shipping lines continuing to exercise extreme caution due to:
- Ongoing security risks
- Limited availability and high cost of war-risk insurance
- Regulatory and military oversight of vessel transit
In addition, increased military presence and enforcement activity in the region are contributing to continued uncertainty around safe passage and transit timelines.
Ocean Freight – Ongoing Disruption, Surcharges & Routing Constraints
Ocean freight services across the Middle East remain significantly impacted:
Service & Routing Impacts
- Vessel schedules continue to be disrupted due to:
- Rerouting of services
- Vessel displacement outside the Gulf region
- Congestion and backlog at key transhipment hubs
- Key gateway ports such as Jebel Ali remain impacted by reduced feeder connectivity
- Alternative landbridge and multimodal solutions continue to be utilised to maintain cargo flows
Booking Restrictions
- Ongoing booking limitations remain in place across several Gulf countries, depending on cargo type and routing
- Priority continues to be given to essential goods such as food and perishables
Emergency & Fuel-Related Surcharges
- Carriers continue to implement and revise Emergency Bunker Surcharges (EBS) and Emergency Fuel Surcharges (EFS) in response to rising fuel costs and operational risks
- Surcharges are being reviewed frequently (weekly or fortnightly) and may change with limited notice
- Additional emergency freight charges remain in place to cover:
- Alternative routing
- Storage in transit
- Additional handling and operational costs
Market Impact
- Global container freight rates have increased across key trades, including Asia–Europe and Trans-Pacific lanes
- Rising fuel costs and constrained capacity are expected to continue placing upward pressure on pricing
Cargo Delays & Transit Disruptions
Customers should continue to expect:
- Extended transit times
- Potential cargo delays or diversions
- Increased risk of port congestion and storage requirements
In some cases:
- Cargo may be held at interim ports pending safe onward movement
- Additional costs such as storage, handling, or re-routing may apply
Air Freight – Capacity Constraints & Rising Costs
Air freight markets remain under significant pressure:
- Air freight rates have increased sharply, with some lanes more than doubling from pre-conflict levels
- Capacity remains constrained due to:
- Airspace disruptions
- Reduced flight frequencies
- Fuel-related surcharges are increasing and are typically:
- Reviewed weekly
- Adjusted in line with jet fuel price movements
Transit disruption surcharges may also apply where rerouting or operational changes are required.
Fuel Market Volatility – Ongoing Cost Pressure
The conflict continues to disrupt global fuel supply chains:
- Oil prices remain volatile, driven by ongoing geopolitical tensions and supply uncertainty
- Fuel availability at major bunkering hubs remains a key concern for carriers
- As a result:
- Fuel surcharges across both ocean and air freight are expected to remain elevated and volatile
- Additional cost increases may be implemented with limited notice
Outlook – Continued Disruption Expected
While diplomatic efforts may continue, the current environment should be viewed as ongoing disruption rather than recovery.
Customers should plan for:
- Continued schedule unreliability
- Persistent capacity constraints
- Ongoing surcharges and cost volatility
There remains no clear timeline for a return to normal operations, and conditions may change rapidly as the situation evolves.
Key Takeaways for Customers
- Expect continued volatility in freight rates and surcharges
- Plan for longer transit times and potential delays
- Budget for additional costs related to fuel, routing, and storage
- Maintain flexibility in supply chain planning where possible
We will continue to monitor developments closely and provide further updates as the situation evolves.
If you have any specific shipments, you would like reviewed, please reach out to your usual contact.