Business · Trade · 1 hr ago
Conflict around Hormuz drives up shipping costs beyond oil
The US-Iran war, which began at the end of February, has made shipping through the Strait of Hormuz more dangerous.
The strait is a key route for moving crude oil and gas, and attacks on merchant ships have killed seamen.
The cost of shipping crude from West Asia to India rose to about eight to ten times its 2022–2025 average by August 2026.
Shipping costs have also climbed for other goods: a global container-shipping benchmark is up about 73% since the war began.
Higher fuel prices and the danger to vessels are adding to the cost of moving goods.
Shipowners are earning more, but they and their crews face greater risks, including when tankers switch off their location signals to cross the strait.
Shipowners are also investing in new capacity, while the shipping crisis remains a major concern for oil industry analysts.
Conflict around the Strait of Hormuz has turned an oil crisis into a broader shipping crisis.
Since the US-Iran war began, shipping costs have risen eight to ten times for oil, about 73% for finished goods and about 49% for commodities.
The average cost of shipping 1,000 barrels of crude from West Asia to India reached $5.1 per mile in August 2026, compared with $0.5-$0.6 per mile on average from 2022 to 2025.
Higher freight rates have increased shipowners’ earnings, while also giving them an incentive to take greater risks.
Tankers crossing the Strait have used a shuttle system, switching off transponders and transferring crude to another tanker in the Gulf of Oman.
- Who
- Shipowners and shipping companies are facing higher costs and risks. Iran has attacked merchant ships in the Strait of Hormuz.
- What
- Conflict around Hormuz has pushed up shipping costs for oil, finished goods and commodities.
- When
- Since the US-Iran war began at the end of February; the article was published on October 12, 2026.
- Where
- The Strait of Hormuz and shipping routes from West Asia, including routes to India and China.
- Why
- Conflict and attacks on merchant ships have increased the danger of using the waterway. Higher bunker fuel prices have also contributed to rising container freight costs.
US
Iran
Movement through the Strait
US
The US has increased efforts to move ships through the Strait of Hormuz.
Iran
Iran has escalated attacks on merchant ships using the waterway.
what started as a crude oil crisis became an oil products (petrol, aviation fuel) crisis, and has now morphed into a shipping crisis.
Israel and the US began attacking Iran, according to the article.
The average cost of shipping 1,000 barrels of crude on the West Asia-to-India route reached $3.4 per mile.
The average cost on that route rose further, to $5.1 per mile.
A Hindustan Times report said daily tanker charter rates to India had more than doubled in two weeks as conflict escalated in West Asia.
- Crude shipping cost
- $5.1 per mile in August 2026 for 1,000 barrels on the West Asia-to-India route
- Historical average
- $0.5-$0.6 per mile from 2022 to 2025 on the same route
- Container freight
- Freightos Baltic Index rose 73% since the US-Iran war began
- Commodity shipping
- Costs rose about 49% since the war began
- VLCC gross earnings
- About $1.2 million per day on the West Asia-to-China benchmark route
- Tankers
- Some vessels cross the Strait with transponders switched off and transfer crude in the Gulf of Oman
Sources
Related news
Philip Morris aims for smoke-free products to make up over 66% of revenue by 2030
Dollar holds near 18-month high as markets await US inflation data
EU banks cut financing for coal companies by 46% in four years
US-China supertanker freight cost falls from record
Asian Markets Open Mixed as Investors Watch Middle East Tensions and US Earnings
Capitalism and Socialism Debate Who Should Guide Growth and Distribution
Oil prices fall on hopes of Russia-Ukraine energy ceasefire
Asian shares cautious as earnings season approaches and oil prices slip
Investors turn to rental housing in Japan and Australia as costs rise
Gold Edges Higher as Traders Assess Trump’s Energy Ceasefire Claim
Ten-year-old oil tankers sell for 17% more than new vessels
