June 19th, 2025 – Tensions between Iran and Israel are putting additional strain on the global container shipping market, as Iran’s threat to close the Strait of Hormuz raises the risk of further disruptions to already tight capacity, potential port closures at Jebel Ali and Abu Dhabi, and rising bunker fuel prices.
While just 2% to 3% of global container volumes transit the Strait of Hormuz – a key chokepoint for global oil flows – any restriction on container traffic would effectively sideline deployed vessels, leading to higher freight rates and extended transit times, according to Container Trade Statistics (CTS).
Maritime analysts warn that the closure of the strait would severely impact container flows to major transshipment hubs in the Gulf. As of now, commercial shipping remains unaffected. However, any escalation that directly impacts vessel traffic in the strait would have immediate and wide-reaching effects on global logistics.
Jebel Ali, the largest port in the Middle East and the 10th busiest globally in 2024 [according to Alphaliner], and Abu Dhabi’s Khalifa Port, a key facility in the UAE’s capital, are both located within the Gulf and depend on unrestricted access through the Strait of Hormuz.
This latest threat compounds existing challenges in the container shipping market. Since late 2023, carriers have been diverting ships away from the Red Sea and Gulf of Aden to avoid attacks from Houthi militants based in Yemen. More recently, some of that capacity has shifted back to the trans-Pacific lanes to accommodate a rebound in U.S. import volumes during a temporary pause in American tariffs.
Container ship supply remains tight. Alphaliner data shows less than 1% of the global container fleet is currently idle, and charter rates remain high. This reflects not only the Middle East diversions but also congestion at major ports in Europe and, to a lesser extent, Asia.
Beyond containerized cargo, the potential closure of the Strait of Hormuz would have even greater consequences for global oil flows. The strait handles more than 17 million barrels of crude oil each day, representing over 20% of global daily crude output. These volumes come from key oil-producing nations including Saudi Arabia, Kuwait, the UAE, Qatar, and Iran itself.
While current oil stockpiles are sufficient to soften short-term impacts, a prolonged closure would disrupt crude exports from the Persian Gulf and create significant volatility in oil and bunker fuel markets. Crude prices initially spiked 7% following Israel’s first strike on Iran but moderated by Monday, with Brent crude falling about 4% to $71.37 per barrel, according to Bloomberg.
If hostilities escalate to the point of closing the Strait of Hormuz, the ripple effects on both container and energy markets could be profound – further tightening an already strained global shipping network.
Trans-Border will continue to monitor the situation and advise customers accordingly. Should you have any questions, send us an email or give us a call at 518-785-6000.
