Container shipping remains on guard in the wake of the ongoing U.S.-Israeli military operations in Iran, as Iranian brass has made threats to attack vessels traversing through the Strait of Hormuz.
Five vessels have already been hit by Iranian missiles since the conflict began Saturday, with four of them being struck while sailing through the critical trade gateway, where it is estimated 20 percent of the world’s oil supply passes through. The fifth ship was attacked at anchor off Oman.
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“The strait is closed,” Ebrahim Jabbari, a senior adviser to the Iranian Revolutionary Guard Corps (IRGC) commander-in-chief, told Iranian media Monday. “If anyone tries to pass, the heroes of the Revolutionary Guards and the regular navy will set those ships ablaze.”
The route remains open, as Iran does not control the Strait of Hormuz. But the threat of attack since the weekend’s attacks has cratered traffic in the conduit, which connects the Persian Gulf to the Gulf of Oman.
Jabbari’s statement comes as providers of maritime war-risk insurance, critical for vessels to transit conflict zones, said they would start withholding coverage as of Thursday.
At the TPM conference in Long Beach, Calif., Ocean Network Express (ONE) CEO Jeremy Nixon wasn’t shy about the concerns the industry had, shedding light into the mass exodus from container shipping firms and oil tankers, among others.
“War insurance has come off, so you can’t put any ships through,” said Nixon, hours after ONE halted new bookings for cargo moving to and from the Persian Gulf until further notice. “You can’t insure your assets there.”
On Tuesday, President Donald Trump sought to assuage global shipping companies of these concerns, announcing that the U.S. Development Finance Corporation would “immediately” provide political risk insurance and financial guarantees for ships traveling through the Persian Gulf, particularly those carrying energy. The president said in a post on Truth Social that the insurance would be available to all shipping lines “at a very reasonable price.”
If necessary, Trump said the U.S. Navy could escort oil tankers through the Strait of Hormuz to ensure their safe passage.
The White House hasn’t provided details of the new plans.
Following in ONE’s footsteps, CMA CGM expanded its shelter-in-place orders for vessels in or bound for the Persian Gulf Tuesday by suspending bookings to and from six affected countries—Bahrain, Kuwait, Qatar, the U.A.E., Saudi Arabia and Iraq. Ports exempted from the ban include Saudi Arabia’s Port of Jeddah and U.A.E. ports Fujairah and Khor Fakkan.
Orient Overseas Container Line (OOCL), which says all its vessels are outside the Persian Gulf, instructed vessels not to come within a 200-nautical-mile radius of the Strait of Hormuz.
According to Nixon, vessels en route to the Middle East would instead have to unload cargo at ports like Fujairah and the Port of Colombo in Sri Lanka. On Tuesday morning, a fire broke out at the Fujairah Port due to falling debris following the successful interception of a drone by air defense systems. Civil defense teams responded promptly to contain the fire.
The Port of Jebel Ali, which is located 20 miles south of Dubai and is the Middle East’s busiest seaport, had to briefly shutdown Sunday after being hit by missile debris related to Iran’s retaliatory strikes.
But as the U.A.E. ports become a security risk for shipping companies that look to skip the port for another major transshipment hub, the knock-on effects are likely to be seen elsewhere in Asia.
“Initially, it’s obviously a Middle East story,” said Nixon. “But there’s exports coming from many different locations, primarily from Asia. I would expect that some of the hubs now will start to lose some of their fluidity: Port Klang, Singapore, some of the other major ports in Asia as well.”
Turloch Mooney, global head of port analytics for S&P Global Market Intelligence, said during the event that the second order effects from the conflict could be “catastrophic” for the ports, noting that Colombo as well as Indian ports like Mundra and Mumbai are already seeing more congestion and disruption.
China has called on all sides of the Iran war to ensure the safe passage of ships through the Strait of Hormuz. The sourcing superpower has a major stake in this conflict even as it looks on from afar—according to export data from trade intelligence platform Kpler, 87 percent of Iran’s crude oil exports go to China.
As ocean carriers continue to navigate the tenuous situation, air cargo flow throughout the region remains at near zero as airspace throughout many of the Middle Eastern countries remains closed.
Two of the region’s largest air carriers have extended their pause on all scheduled flights at their Dubai and Abu Dhabi hubs.
Emirates said its suspension would continue until midnight on Wednesday in Dubai, but noted that it will operate a limited number of passenger repatriation and freighter flights on Tuesday and Wednesday.
Etihad said flights to and from Abu Dhabi remain on pause until 2 p.m. local time on Thursday. Some repositioning, cargo and repatriation flights may operate in coordination with U.A.E. authorities, the company said.
The bumpy road for the supply chain comes as logistics providers have made it an imperative to keep costs down.
Freight forwarding giant Kuehne + Nagel is expecting to lay off more than 2,000 full-time employees in 2026 as part of a wider $255.7 million cost-savings plan implemented in its fourth quarter.
Kuehne + Nagel’s layoffs are projected to save the company $191.9 million next year, with facilities-related cost reduction accounting for $38.4 million in savings.
The company is making are higher than previously anticipated, with original targets shooting for a staff reduction range of 1,000 to 1,500 full-time employees.
The headcount cuts would represent 2.3 percent of Kuehne + Nagel’s 85,000-person staff.
