For this week’s logistics market update, the transpacific market is adjusting to a changing set of cost and operational factors tied largely to higher fuel prices and evolving vessel routings. Recent developments in the Middle East are influencing bunker costs and availability, prompting carriers to take steps to manage expenses and maintain service reliability. This update outlines the current fuel situation, expected surcharge activity, and early shifts in capacity and pricing so shippers can plan accordingly.
Market Overview: Volatility Building
Uncertainty continues to build across the transpacific market as tensions in the Middle East drive sharp increases in fuel costs.
Bunker fuel supply is tightening at key hubs, and fuel prices have surged since the start of the Iran conflict. Carriers are already feeling the impact, with some reporting tens of millions of dollars in additional weekly operating costs.
While fuel availability in Asia is still manageable for now, the situation is becoming more fragile. If disruptions around the Strait of Hormuz continue, shortages could spread globally in the coming weeks.
To manage the situation, carriers are:
- Slowing vessel speeds to conserve fuel
- Refueling more frequently in the U.S. and Europe
- Repositioning fuel supplies into Asia
- Preparing cost recovery measures
Fuel Surcharges Coming
Emergency Fuel Surcharges (EFS) are being rolled out and are expected to take effect in the second week of April.
These costs are likely to be built into freight rates, with expected increases of:
- +$200 to $300 per TEU
As always, the increases will depend on demand levels and overall market conditions.
India → USA Market Update
Space is starting to tighten as carriers reroute vessels away from high-risk areas like the Red Sea and Strait of Hormuz.
Key trends:
- Vessel delays and schedule disruptions increasing
- Equipment imbalance beginning to emerge
- Higher risk of booking rollovers, especially to the East Coast
While space is still available today, the outlook points to tighter conditions in the weeks ahead.
Booking tip: Plan 1–2 weeks in advance, especially for USEC cargo.
Equipment Situation
- Nhava Sheva / Mundra / Chennai: Equipment still stable for now
- Early signs of imbalance due to delayed vessel cycles
- Kolkata: Ongoing congestion and delays
If disruptions continue, equipment shortages are likely to follow.
Pricing Outlook
- Market remains firm to slightly rising
- Carriers pushing GRIs + EFS in April
- Upward pressure building, especially on USEC lanes
Bunker Market: From Price Spike to Supply Crisis
The bunker market is shifting from a pricing issue to a broader supply challenge.
What’s driving it:
- Export restrictions from key countries
- Rerouting around conflict zones, increasing transit times
- Tight availability of low-sulfur fuels globally
Fuels particularly affected:
- LSMGO (low sulfur marine gas oil) – hardest to secure and commanding premiums
- VLSFO – volatile but still widely used
Some regions are already seeing restricted supply or bundled fuel offerings, making procurement more complex.
Bottom line: Fuel availability—not just price—is becoming the key risk.
Air Freight Market Update
China → USA
- Fuel surcharges continue to rise into April
- Charter costs remain elevated (B747-400 surcharges increasing)
- Airline adjustments implemented across global trade zones
Asia → USA Air Market
Hong Kong
- Middle East services suspended through May 31
- Fuel surcharges jumping 200%+ vs March
- Rates increasing sharply (case-by-case)
- Strong demand driven by World Cup-related shipments
Southeast Asia
Demand continues to surge, driven by:
- High-tech cargo
- E-commerce
- Fashion and electronics
Fuel surcharges have also increased significantly (200%+ month-over-month), with pricing remaining highly dynamic.
Key Takeaways from this week
- Fuel is now the biggest wildcard in global shipping
- Emergency surcharges are coming fast
- Space is tightening, especially out of India to USEC
- Airfreight demand remains strong despite rising costs
Market conditions are evolving steadily, with fuel costs playing a growing role in rate adjustments and carrier operations across ocean and air services. While most lanes remain workable today, planning ahead and staying informed will be increasingly important as April progresses. If this type of clear, practical market insight is helpful to your planning, subscribe to our newsletter to receive weekly updates and straightforward guidance on what’s changing and what it means for your shipments.
Contact us with any questions or to discuss how these trends may impact your supply chain.
