Escalating geopolitical tensions across the Middle East are now materially disrupting regional and global logistics networks, with knock-on effects expected across energy markets, freight pricing and broader supply chain reliability. What began as a security escalation over the weekend of 28 February has rapidly evolved into a multi-modal freight disruption affecting both air and ocean corridors that connect Asia, Europe and Oceania. Early warnings from shipping lines are suggesting significant increases in freight costs for goods originating or destined for any affected regions.

For Australian businesses, this is not a distant regional event. The Middle East functions as a critical transit and energy hub within global trade architecture. Disruptions in this region have direct consequences for freight capacity, transit times, fuel pricing and schedule integrity worldwide.

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Current Situation Overview

Recent security developments have led to the closure or restriction of multiple Middle Eastern airspaces, alongside the suspension of maritime traffic through the Strait of Hormuz, one of the world’s most critical maritime chokepoints, handling a substantial share of global energy exports as well as containerised trade flows serving the Gulf region.

Tom Jensen from the Freight & Trade Alliance, warns that shipping disruptions linked to the Middle East conflict are already beginning to impact freight pricing and operational stability.

The closure of the Strait of Hormuz has forced several shipping lines to suspend services in the area or turn vessels around, reducing available capacity and disrupting established routes. As a result, emergency conflict surcharges have been introduced almost immediately, in some cases, doubling overnight. For example, conflict surcharges have reportedly increased from around USD $2,000 per 20-foot container to approximately USD $4,000 per refrigerated container. Such rapid cost escalation can dramatically increase the overall freight cost of shipments moving through affected corridors.

Shipping lines may struggle to pass these sudden increases directly onto customers if freight contracts have already been agreed at fixed rates. In those situations, carriers may be forced to absorb the additional costs themselves, potentially making certain services commercially unviable if disruptions persist.

While Australia imports roughly AUD $3 billion worth of goods annually from the Middle East — much of it petroleum and related products — the export exposure is significantly larger. Australia exports around AUD $10 billion worth of goods to the region each year, meaning extended disruptions could have a notable impact on Australian exporters.

Sectors particularly exposed include the meat and fresh produce industries, which rely heavily on Middle Eastern markets. On the import side, Australia is hugely dependent on imported fuel and fertiliser, with the Middle East a major source of both. Fortunately, requirements for seeding, which will start in earnest next month, would be covered. Most of the fertiliser required for seeding is either in Australia or safely on its way.

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Latest Liner Announcements

Shipping Line
CMA CGM and ANL	Suspended reefer, hazardous and all bookings to/from many Gulf countries; diverted vessels to contingency ports; introduced emergency conflict surcharge. More
MSC	Halted worldwide bookings to Middle East; instructed vessels to seek safe shelters; declared end‑of‑voyage for Arabian‑Gulf cargo and diverted ships to safe ports. More
Maersk	Suspended cargo booking acceptance for multiple cargo types across key Gulf markets. Reefer, dangerous goods, OOG and dry cargo bookings are suspended to/from UAE, Oman (except Salalah), Iraq, Kuwait, Qatar, Bahrain and parts of Saudi Arabia (Dammam & Jubail). Some cargo types are also suspended to/from Jordan. Exceptions apply for essential goods such as food and medicine. Cargo to/from Jeddah, King Abdullah Port, Salalah, Jordan, Lebanon and Israel remains accepted. Some cargo already in transit may be rerouted or temporarily stored to maintain network stability. More
Hapag‑Lloyd	Suspended shipments to and from the Upper Gulf region (including UAE, Saudi Arabia, Kuwait, Qatar, Bahrain, Iraq, Oman and Yemen) due to the security situation. Vessels may remain in safe waters, deviate to contingency ports, or experience schedule disruptions and delays. Cargo already booked may be cancelled or required to be returned to customers, while cargo in transit may be rerouted, returned to origin, or declared end-of-voyage storage if delivery becomes impossible. War Risk Surcharges and additional operational charges may apply. More
Ocean Network Express (ONE)	Temporarily suspended new bookings to and from the Persian Gulf; monitoring cargo in transit and providing updates. More
COSCO Shipping Lines	Directed vessels already in or bound for the Gulf to proceed to safe waters, reduce speed or anchor; evaluating contingency plans and alternative discharge ports. More
Yang Ming	Notified customers that certain Middle‑East services are impacted; schedule delays and route changes expected; cargo acceptance suspended for affected services. More
ZIM	Israeli ports (Ashdod & Haifa) operating normally; bookings continue; hazardous cargo subject to change; offices work remotely but continue services. Rate Restoration announced of USD $500 per TEU (applies to both dry and reefer cargo) on Northeast and Southeast Asia to Australia effective 16 Mar 2026. More

Airspace
Emirates	Suspended all scheduled flights to/from Dubai until 23:59 UAE time on 4 March; operating limited repatriation and freighter flights; advised passengers not to go to the airport unless notified. More
Etihad Airways	Suspended all commercial flights to/from Abu Dhabi until 14:00 UAE time on 5 March; only repositioning, cargo and repatriation flights may operate; offered free rebooking/refund for affected tickets. More
Qatar Airways	Flights temporarily suspended due to closure of Qatari airspace; operations will resume when the airspace reopens; a full cargo embargo has been extended until end of day 10th March 2026. This applies to all cargo movements departing Australia and New Zealand. More
Lufthansa Group	Suspended flights to Tel Aviv, Beirut, Amman, Dammam, Tehran, & Erbil until 8 March and to Dubai, Abu Dhabi & Larnaca until 6 March; avoiding multiple Gulf airspaces; passengers can rebook or refund. More
KLM Royal Dutch Airlines	Cancelled all flights to and from Dubai, Riyadh and Dammam through 5 March; working with authorities to repatriate travellers; offering free rebooking and refunds. More
FedEx	Suspended flights to/from Bahrain, Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Oman, Qatar, UAE, and Saudi Arabia. Resuming operations “where it is safe to do so”. Has advised that other regional markets may also see longer transit times. More

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Air Freight Implications

Airspace across Iran, Iraq, Kuwait, Israel, Bahrain, the UAE and Qatar has been closed or heavily restricted. Major hub airports including Dubai, Abu Dhabi and Doha are currently shut, removing a significant portion of global transhipment capacity.

From an operational perspective, airlines are being forced to suspend services or implement longer indirect routings, increasing flight times and fuel burn. Transit times are lengthening and schedule reliability has deteriorated due to diversions and congestion across alternative corridors.

From a market perspective, these conditions increase exposure to short-notice cancellations, rebooking queues, space shortages and upward pricing pressure, particularly for time-sensitive and high-value cargo.

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Global Air Freight Market Effects

The Middle East acts as a central bridge between Asia, Europe and Oceania. Its disruption is therefore propagating across the wider air freight ecosystem.

Key expected impacts include reduced global capacity as aircraft are redeployed, increased pressure on Asia–Europe and Asia–Middle East lanes, and heightened rate volatility driven by constrained supply. Carriers operating near affected airspace may introduce or expand war-risk surcharges, while potential increases in jet fuel prices reflect broader geopolitical risk in global energy markets.

For Australian exporters and importers, particularly those moving pharmaceuticals, perishables, mining equipment or time-critical project cargo, reduced uplift and rate volatility are likely to be felt even on routes not directly touching the Gulf.

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Ocean Freight and Maritime Risk

With vessel movements through the Strait of Hormuz suspended or rerouted, container carriers are reassessing service patterns and port calls across the Gulf region. Several operators have directed vessels to designated safe shelter areas, while others are rerouting services around the Cape of Good Hope.

Extended voyage distances increase fuel consumption and operating costs, while blank sailings and service gaps may emerge for Gulf-linked trade flows. Even cargo not directly destined for the Middle East may experience knock-on effects due to equipment imbalances and global vessel redeployment.

Schedule integrity is likely to remain volatile, impacting inventory planning, contractual performance and supply chain predictability.

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Energy Market and Cost Exposure

Because the Strait of Hormuz is also a critical artery for global oil and LNG exports, freight disruption intersects directly with energy markets. Rising fuel costs feed into higher bunker surcharges for ocean freight and elevated jet fuel costs for air carriers.

War-risk premiums and emergency conflict surcharges may further increase transport costs. These cost pressures have the potential to pass through to downstream pricing across logistics-sensitive sectors, contributing to broader inflationary dynamics.

The current situation presents several key risk dimensions:

Volatility risk: Freight rates and energy-linked costs may remain elevated while security conditions are unresolved.

Supply chain resilience: Businesses exposed to Middle East transit routes should assess contingency routing and inventory buffers.

Cost pass-through: Surcharges, fuel adjustments and storage exposure may impact landed cost calculations.

Event sensitivity: Further escalation or de-escalation could rapidly alter capacity availability and pricing structures.

Even once restrictions ease, recovery is unlikely to be immediate. Carriers will need time to reposition aircraft, vessels and equipment, and unwind backlogs created during the disruption period.

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What Australian Businesses Can Do Now

Proactive planning is essential in fast-moving environments like this.

• Prioritise must-move shipments and confirm escalation pathways for urgent cargo.
• Pre-approve contingency routings or alternative gateways to avoid decision delays.
• Build additional buffer into ETAs and align sales or installation commitments accordingly.
• Seek early clarity on potential war-risk, fuel and storage cost exposure.

ICE is actively monitoring developments in coordination with carriers, global partners and authorities. We are reviewing impacted shipments, assessing safe and practical alternative routings, and preparing recovery strategies so we can act swiftly as conditions permit.

Australian importers and exporters should expect continued operational uncertainty in the near term and remain alert to rapid changes in transport capacity, pricing structures and risk premiums.

For shipment-specific guidance or contingency planning support, please contact your ICE representative at 1300 227 461.

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Related News

Middle East conflict sparks slew of shipping charges – Grain Central

Middle East conflict: what does it mean for Australian shippers? – DCN

The narrow strait of water putting oil prices and freight costs on the brink – ABC

Air cargo tackles backlogs as Middle East conflict capacity crunch continues – Air Cargo News