Five weeks after the closure of the Strait of Hormuz, spot rates for container shipping in the major East-West corridors are experiencing widespread increases in a context marked by operational uncertainty, rising fuel costs, and congestion at several transshipment hubs in Asia. Nevertheless, Drewry believes that the situation has not reached a level comparable to the freight crisis recorded during the pandemic and argues that shippers should not act with alarm on routes not directly connected to the Middle East.
Xeneta's analysis places the increase in spot rates on routes with direct exposure to the Middle East between 30% and 31% since late February. However, the impact of the crisis has also spread to corridors far from the conflict's focal point. Traffic between the Far East and the West Coast of the United States, for example, shows a 29% increase in the same period, reflecting the global reach of a disruption that already affects the international logistics network beyond the Gulf region.
Peter Sand, chief analyst for maritime transport at Xeneta, indicates that no shipper is exempt from financial or operational risk. According to his assessment, congestion in Middle Eastern ports is transferring pressure to Asian transshipment centers like Singapore, Port Klang, and Tanjung Pelepas, all key for redistributing goods to other markets, including the United States. This disruption in flows causes delays, increases planning costs, and adds tension to a market that is approaching peak season with narrower maneuvering room.
Shipper behavior is heavily influenced by recent market experiences. Xeneta points out that many companies still remember the second phase of the Red Sea crisis in 2024, when congestion in Singapore led to a doubling of rates that were already at elevated levels. This precedent is leading some demand to secure capacity at current prices to reduce the risk of running out of available space in the coming months.
Sand interprets this reaction as a premium paid for certainty, in a scenario where shippers prefer to incur a higher immediate cost rather than risk further increases or difficulties accessing cargo hold during the peak season. At the same time, he warns that shipping companies might activate new contingency measures, including speed reductions, route changes, or cancellations of scheduled stops, depending on the evolution of the conflict and its impact on logistic chains.
In addition to the pressure on rates, the cost of fuel is rising. Bunker prices in Singapore, the world's main hub for marine fuel supply, continue to hover around double the levels prior to the crisis, although with a moderately downward trend. In Rotterdam, on the other hand, prices are on an upward trajectory. Additionally, there are extra costs linked to vessel-to-vessel supply operations in the Far East, a method that introduces greater operational complexity.
The organization Transport & Environment (T&E), based in Brussels, estimates that shipping companies are facing a daily additional cost of 340 million euros in fuel since the onset of hostilities in the Middle East. According to their estimates, the price of very low sulfur fuel oil in Singapore has reached 941 euros per ton, with an increase of over 220% since the beginning of the year. Liquefied natural gas, for its part, has accumulated a 72% increase since early March.
In this context, Xeneta places the average spot rate for April 1 at 2,430 dollars per FEU on the route between the Far East and the West Coast of the United States, at 3,382 dollars towards the North American East Coast, at 2,904 dollars towards Northern Europe, and at 4,333 dollars towards the Mediterranean. On the corridor between Northern Europe and the East Coast of the United States, the average stands at 1,775 dollars per FEU. These figures reflect a broad upward movement, although with varying intensity depending on each route's exposure to the crisis.
Despite this volatility, Drewry Shipping Consultants considers that the container market is not experiencing a significant drop in capacity comparable to that observed during the pandemic, except on Gulf routes. Philip Damas, head of the logistics area at the consultancy, argues that increases on corridors not connected to the Middle East should remain within manageable levels. From his perspective, current behavior is partly a response to opportunistic price movements, especially in traffics more linked to the conflict zone.
Drewry adds that, in this scenario, monitoring rates and surcharges linked to fuel is crucial for cargo owners. The evolution of bunker prices and the costs associated with transport can quickly alter the final price structure, making access to updated references central to logistics and commercial decision-making.
The development in the coming weeks will depend on the duration of the restrictions in the Strait of Hormuz, the ability of Asian ports and hubs to absorb diversions and cargo accumulations, and the decisions made by shipping companies to adjust their networks. For now, the market reflects a combination of caution from shippers, energy surcharges, and increasing pressure on major intercontinental routes.