Freight rates on the Middle East routes are soaring and may exceed 10,000!Shipping costs and insuran
- Author:Maintenance network
- Source:Maintenance network
- Release Date:2026-04-16
Currently, the geopolitical situation in the Strait of Hormuz continues to be tense, and navigation in the Strait has been blocked for six weeks.
The global Middle East shipping market has experienced significant fluctuations in route operations, cargo transportation, freight rates and insurance costs.
At present, the freight rates of the Middle East routes have exceeded the market psychological barrier. The freight rates of 40-foot large containers that are transported by land to the Persian Gulf countries through ports outside the strait have risen to over 8,000 US dollars since this week.
Some shipping companies' all-inclusive quotations for shipping from China to Jebel Ali Port in the Middle East have reached as high as US$8,346 and US$8,502 including emergency war surcharges, just one step away from the 10,000 yuan mark.
The overall freight rates at basic ports in the Persian Gulf have more than quadrupled compared to before the conflict broke out at the end of February.
The transportation time has also been greatly extended, and the original direct routes have been completely interrupted.
All incoming and outgoing ships need to detour to surrounding non-strait ports such as Fujairah and Khor Fakkan in the United Arab Emirates, and then connect to core Persian Gulf ports such as Jebel Ali, Dammam, and Khalifa through feeder ship transshipment, road transportation, etc. The land transportation link will take 3 to 10 days.
Taking the route from Shanghai Port to Jebel Ali Port announced by Maersk as an example, the entire transportation cycle has been extended to more than 32 days, and the land transportation link is restricted by factors such as port clearance and vehicle resources, making the cargo delivery cycle full of great uncertainty.
Ships sailing in the Strait of Hormuz.IC Photo
What puts more pressure on the industry than the skyrocketing freight rates is the cliff-like surge in insurance costs. Before the conflict, ship war insurance rates were only 0.2%-0.3% of the hull value.
Now that many member institutions of the British Lloyd's Market Association have withdrawn their war insurance coverage in the Persian Gulf waters, the rates of the remaining underwriters have soared to 1%-3%, and some high-risk routes have even reached 5%-7.5%.
The war insurance rate in the Red Sea has also increased simultaneously from 0.25% to 1%-3%, and the overall premium has skyrocketed nearly ten times.
In addition to basic freight and insurance premiums, shipping companies have imposed emergency conflict surcharges, further pushing up comprehensive logistics costs.
The freight for a 40-foot container on the Asia-Europe route has risen from approximately US$2,200 before the war to US$3,800. The freight for oil tankers from the Persian Gulf to Asia has soared from US$800,000 to US$9.5 million per voyage. The superposition of various costs has overwhelmed the entire trade link.
Route operation and billing rules have also been restructured. At present, only a few shipping companies such as CMA CGM, COSCO Shipping Lines, Mediterranean Shipping Company, Maersk, and Haberrod have gradually resumed Persian Gulf routes. Most airlines still maintain a cautious wait-and-see attitude, and the market's effective transport capacity is seriously insufficient.
Operational restrictions at peripheral ports have also intensified cost pressures. The Port of Fujairah stipulates that containers can only stay for three days. If they exceed the limit, they need to be transferred to Sharjah Port, incurring additional hauling and warehousing costs.
In addition, there is a shortage of truck resources at the Oman gateway to the interior of the Middle East, and the traditional container billing logic fails.
A 20-foot small container is no longer priced at less than 40% off a 40-foot large container. Some shipping companies have quoted prices for 20-foot small containers at US$6,423 or US$7,101. The price of a small container is almost as high as that of a large container.
In the short term, as long as the situation in the Strait of Hormuz does not significantly ease, freight rates on the Middle East route are still likely to continue to rise, and breaking through the US$10,000 mark is not empty talk.
For freight forwarders, foreign traders and cross-border sellers, it is now necessary to recalculate the profit model, strictly control the pace of shipments, and plan alternative transportation plans in advance. Under the dual challenges of high costs and high risks, they should be cautious in dealing with this ongoing shipping crisis.
The global Middle East shipping market has experienced significant fluctuations in route operations, cargo transportation, freight rates and insurance costs.
At present, the freight rates of the Middle East routes have exceeded the market psychological barrier. The freight rates of 40-foot large containers that are transported by land to the Persian Gulf countries through ports outside the strait have risen to over 8,000 US dollars since this week.
Some shipping companies' all-inclusive quotations for shipping from China to Jebel Ali Port in the Middle East have reached as high as US$8,346 and US$8,502 including emergency war surcharges, just one step away from the 10,000 yuan mark.
The overall freight rates at basic ports in the Persian Gulf have more than quadrupled compared to before the conflict broke out at the end of February.
The transportation time has also been greatly extended, and the original direct routes have been completely interrupted.
All incoming and outgoing ships need to detour to surrounding non-strait ports such as Fujairah and Khor Fakkan in the United Arab Emirates, and then connect to core Persian Gulf ports such as Jebel Ali, Dammam, and Khalifa through feeder ship transshipment, road transportation, etc. The land transportation link will take 3 to 10 days.
Taking the route from Shanghai Port to Jebel Ali Port announced by Maersk as an example, the entire transportation cycle has been extended to more than 32 days, and the land transportation link is restricted by factors such as port clearance and vehicle resources, making the cargo delivery cycle full of great uncertainty.
Ships sailing in the Strait of Hormuz.IC Photo
What puts more pressure on the industry than the skyrocketing freight rates is the cliff-like surge in insurance costs. Before the conflict, ship war insurance rates were only 0.2%-0.3% of the hull value.
Now that many member institutions of the British Lloyd's Market Association have withdrawn their war insurance coverage in the Persian Gulf waters, the rates of the remaining underwriters have soared to 1%-3%, and some high-risk routes have even reached 5%-7.5%.
The war insurance rate in the Red Sea has also increased simultaneously from 0.25% to 1%-3%, and the overall premium has skyrocketed nearly ten times.
In addition to basic freight and insurance premiums, shipping companies have imposed emergency conflict surcharges, further pushing up comprehensive logistics costs.
The freight for a 40-foot container on the Asia-Europe route has risen from approximately US$2,200 before the war to US$3,800. The freight for oil tankers from the Persian Gulf to Asia has soared from US$800,000 to US$9.5 million per voyage. The superposition of various costs has overwhelmed the entire trade link.
Route operation and billing rules have also been restructured. At present, only a few shipping companies such as CMA CGM, COSCO Shipping Lines, Mediterranean Shipping Company, Maersk, and Haberrod have gradually resumed Persian Gulf routes. Most airlines still maintain a cautious wait-and-see attitude, and the market's effective transport capacity is seriously insufficient.
Operational restrictions at peripheral ports have also intensified cost pressures. The Port of Fujairah stipulates that containers can only stay for three days. If they exceed the limit, they need to be transferred to Sharjah Port, incurring additional hauling and warehousing costs.
In addition, there is a shortage of truck resources at the Oman gateway to the interior of the Middle East, and the traditional container billing logic fails.
A 20-foot small container is no longer priced at less than 40% off a 40-foot large container. Some shipping companies have quoted prices for 20-foot small containers at US$6,423 or US$7,101. The price of a small container is almost as high as that of a large container.
In the short term, as long as the situation in the Strait of Hormuz does not significantly ease, freight rates on the Middle East route are still likely to continue to rise, and breaking through the US$10,000 mark is not empty talk.
For freight forwarders, foreign traders and cross-border sellers, it is now necessary to recalculate the profit model, strictly control the pace of shipments, and plan alternative transportation plans in advance. Under the dual challenges of high costs and high risks, they should be cautious in dealing with this ongoing shipping crisis.