The Middle East war impacts shipping, but not as severely as the pandemic, says analyst Lars Jensen at TPM26, according to the Journal of Commerce.
The war in the Middle East that has closed the Persian Gulf and Strait of Hormuz poses a challenge for container shipping, but not on the scale of the pandemic, industry analyst Lars Jensen told TPM26 delegates, reports New York's Journal of Commerce.
Mr. Jensen, CEO of Vespucci Maritime, stated that approximately two million TEU of cargo bound for the Gulf will be affected, with much of it offloaded at ports around the Strait of Hormuz. He emphasized that while capacity will contract, the disruption is limited compared to the Red Sea diversions of 2023-24.
The analyst noted that importers had anticipated a return of Asia-Europe and Asia-US East Coast traffic to the Suez Canal this year; however, the war has prolonged the necessity for diversions around Africa. He mentioned that carriers will maintain pricing leverage as supply and demand remain tight.
Mr. Jensen added that container lines are unlikely to resume Suez Canal transits for at least six months, even if the conflict ends immediately. Major carriers have largely avoided the Red Sea route since late 2023 due to Houthi attacks on shipping linked to the Gaza war.
Rising oil prices will increase bunker costs, prompting carriers to impose emergency fuel and conflict surcharges across trades. Mr. Jensen warned that even shippers on the Asia-US West Coast will face higher costs and congestion due to knock-on effects.
