Container freight rates surge as Middle East tensions and peak season demand reshape shipping

For much of 2025, the container shipping market appeared to be moving toward stability. Excess vessel capacity, softer consumer demand and easing supply chain disruptions had pushed freight rates well below the extraordinary highs witnessed during the pandemic and the Red Sea crisis. However, June 2026 has brought a sharp reversal.

Container freight rates are once again climbing across major trade lanes as geopolitical tensions in the Middle East combine with an earlier-than-expected peak shipping season. Recent market indicators from Freightos and Drewry show a broad-based increase in spot rates, particularly on Transpacific and Asia-Europe routes.

The immediate trigger has been the continuing disruption linked to the Middle East conflict. Since February, uncertainty surrounding the Strait of Hormuz, rising bunker fuel costs and ongoing security concerns have added significant pressure to global shipping networks. According to Freightos, the closure of Hormuz has kept fuel costs elevated throughout the traditionally weak shipping season and has prevented freight rates from falling to their normal annual lows. Reuters reports that bunker fuel prices have surged by more than 50% since the conflict began, increasing operating costs for carriers worldwide.

The impact is now becoming visible in freight benchmarks.

According to Drewry's latest World Container Index, the composite index increased to approximately USD 3,549 per 40-foot container in the week ending 11 June 2026. The benchmark had already surged 23% in the previous week before gaining another 3%, indicating that the upward trend remains firmly intact. Drewry attributes the increase primarily to stronger Transpacific and Asia-Europe demand as the peak season begins earlier than usual.

Individual trade lanes have experienced even sharper movements.

Drewry data shows freight rates from Shanghai to Los Angeles rising to around USD 4,683 per FEU, while Shanghai to New York climbed to approximately USD 5,870 per FEU. These are substantial increases within a short period and suggest that carriers are successfully implementing higher freight all kinds (FAK) rates and peak season surcharges.

In early June, we saw  weekly increases of 51% on Asia-US West Coast routes, 25% on Asia-US East Coast services, 37% on Asia-Northern Europe trades and 24% on Asia-Mediterranean corridors. Only a few weeks earlier, many of these same routes were either flat or declining, highlighting the speed of the market's turnaround.

The current rally differs from the supply-chain chaos seen during the pandemic. Back then, the market suffered from equipment shortages, port congestion and capacity constraints. Today, the global container fleet is significantly larger, and vessel availability remains relatively healthy. Instead, the market is being driven by three interconnected factors.

First, fuel costs have risen sharply due to geopolitical risks in the Middle East. Second, carriers are actively managing capacity through blank sailings and network adjustments. Third, cargo owners are advancing shipments earlier than normal in anticipation of further rate increases and possible supply disruptions later in the year. Together, these factors are creating a tighter market despite the industry's substantial fleet expansion.

The Middle East situation continues to create uncertainty for shipping lines. Earlier this year, Maersk suspended certain Middle East services because of security concerns, while insurers increased war-risk assessments for vessels operating in the region. Any further escalation could place additional upward pressure on freight rates, insurance costs and transit times.

For importers and exporters, the key question is whether this rally will continue through the second half of 2026.

Current indicators suggest that rates are likely to remain firm through the traditional peak season. Drewry expects continued support from early-season demand, while we see that carriers are already applying premiums and tightening allocations on several major routes. If fuel costs remain elevated and geopolitical tensions persist, freight rates could continue to rise through the third quarter.

However, the market is unlikely to revisit the extreme levels seen during 2021 and 2022. The global container fleet has expanded significantly over the past three years, providing a substantial buffer against prolonged shortages. Unless major trade routes experience further disruptions, increased vessel capacity should eventually limit the extent of future rate increases.

For logistics managers, procurement teams and cargo owners, the message is clear. The era of continuously declining freight rates appears to have paused. The combination of geopolitical risk, higher fuel costs and early peak season demand has returned volatility to container shipping, making freight budgeting and supply chain planning more challenging once again.

The coming months will determine whether the current surge is a temporary seasonal spike or the beginning of another sustained period of elevated freight costs. Either way, global shipping markets have entered the second half of 2026 with renewed uncertainty.