Analyst insight following escalation of Israel-Iran conflict
Peter Sand, Xeneta Chief Analyst:
“Geo-politics is once again threatening the safety and stability of global supply chains so we must hope for de-escalation in the conflict between Israel and Iran, with concerns it could see a de-facto closure of the Strait of Hormuz - a vital entry point for container ships calling at ports such as Jebel Ali and the wider Arabian Gulf region.
“Any closure of the Strait of Hormuz would see services re-routed, with increased reliance on India West Coast ports for connecting the Far East to Indian sub-continent. The inevitable disruption and port congestion, as well as the potential for higher oil prices, would cause a spike in ocean freight container shipping rates, with carriers likely also pushing for a ‘security surcharge’ on these trades in the coming days.
“This escalation also makes a largescale return of container ships to the Red Sea seem less likely, a situation which continues to have a major impact on ocean container shipping rates 18 months after Iran-backed Houthi Militia in Yemen began attacking vessels in the region.
“Average spot rates from Far East to North Europe are up 62% since 1 December 2023, just before escalation in the Red Sea, while average spot rates to US East Coast – another trade that would ordinarily transit the Suez Canal - are up 165%.”
Global ocean container shipping data highlights
- Market average spot rates – 12 June 2025:
- Far East to US West Coast: USD 5345 per FEU (40ft container)
- Far East to US East Coast: USD 6568 per FEU
- Far East to North Europe: USD 2434 per FEU
- Far East to Mediterranean: USD 4065 per FEU
- North Europe to US East Coast: USD 2122 per FEU
- Market mid-high spot rates – 12 June 2025:
- Far East to US West Coast: USD 6100 per FEU
- Far East to US East Coast: USD 7213 per FEU
- Far East to North Europe: USD 2712 per FEU
- Far East to Mediterranean: USD 4800 per FEU
- North Europe to US East Coast: USD 2386 per FEU
Note: The Xeneta mid-high is the spot rates paid by shippers in the 75th percentile of the market. The market mid-low (referenced below) is the 25th percentile of the market.
- Market mid-low on the Transpacific trade from Far East to US West Coast has increased 41% since 1 June to USD 5100 per FEU.
- The spread between the market mid-low and mid-high at the end of May was USD 250 before increasing to USD 2506 on 1 June, driven by increase in mid-high. The spread has now narrowed to USD 1000 on 12 June, driven by increase in mid-low (see chart below)
- Flatter market mid-high and narrowing spread with market mid-low suggests spot rate spike following the lowering of US-China tariffs in May is now reaching a peak.
- Offered capacity on the Transpacific trade is up 28% in mid-June compared to mid-May – and continuing to trend upwards - as carriers respond to cargo rush following lowering of tariffs. Increased capacity further supports forecast of spot rates reaching a peak in June.
- Conflict in the Red Sea continues to impact ocean container freight rates with majority of ships sailing around the Cape of Good Hope. Average spot rates from Far East to North Europe are up 62% since 1 December 2023, while average spot rates to US East Coast – another trade that would ordinarily transit the Suez Canal - are up 165%.
Xeneta analyst insight – Far East to US West Coast (impact of US-China tariffs)
Peter Sand, Xeneta Chief Analyst:
“A narrowing of the market mid-high and mid-low in Xeneta data indicates the fear and uncertainty that drove spot rates upwards in the wake of the 90-day lowering of US-China tariffs is now easing.
“Xeneta has previously stated we expect spot rates to peak in June before downward pressure returns and this is how it is playing out.
“Shipping capacity is returning to the Transpacific trade – up 28% since mid-May - as carriers react to shippers rushing cargo during the 90-day window of lower tariffs. This increased capacity and a slowing in the cargo rush should see a return of the downward pressure on spot rates we saw during Q1 prior to the ‘Liberation Day’ tariff announcement.”
Ends
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About Xeneta
Xeneta is the leading ocean and air freight rate benchmarking and market analytics platform transforming the shipping and logistics industry. Xeneta’s powerful reporting and analytics platform provides liner-shipping stakeholders the data they need to understand current and historical market behavior – reporting live on market average and low/high movements for both short and long-term contracts. Xeneta’s data is comprised of +600 million contracted container and air freight rates and covers over 170,000 global ocean trade routes and over 60,000 airport-airport connections. Xeneta is a privately held company with headquarters in Oslo, Norway. To learn more, please visit www.xeneta.com
Xeneta’s Media Contacts:
Philip Hennessey
Director of External Communications
Xeneta
+44 7830 021808
press@xeneta.com
