Global freight markets remain heavily influenced by the continued disruption linked to the Middle East crisis, with the effective closure of the Strait of Hormuz continuing to distort energy flows, sustain elevated fuel pricing and reduce operational flexibility across major transport networks.
Ocean and air freight carriers continue managing longer routings, constrained effective capacity and inconsistent service reliability, while diesel inflation is increasingly reshaping road freight pricing across Europe and North America.
Although direct military escalation has eased compared with earlier in the year, the market impact remains significant. Bunker, jet fuel and diesel costs all remain substantially above historical norms, creating ongoing surcharge pressure and limiting any meaningful reduction in transport costs.
At the same time, manufacturing activity has shown signs of stabilisation across parts of Europe and the US, supporting industrial freight demand and selective inventory rebuilding. However, inflationary pressure, cautious consumer confidence and geopolitical uncertainty continue limiting broader market momentum, creating a freight environment defined by cost volatility, constrained capacity and uneven recovery conditions.
Ocean Freight
Although Asia-Europe spot rates softened slightly during late April, conditions are tightening again ahead of seasonal demand peaks and continued blank sailing programmes. Around 19% of Asia-Europe capacity was blanked during week 19, with further cancellations expected through May and early June. Schedule reliability also remains under pressure, with delays across Europe and Indian Subcontinent services continuing to exceed historical norms.
While spot markets on some transpacific east coast services have softened in recent weeks, pricing into the US west coast has remained comparatively firm, reflecting a combination of disciplined capacity management and early inventory replenishment by shippers.
Market indices show Asia-US west coast spot rates continuing to rise modestly week on week and, depending in the index, remaining 35% to 50% above levels seen before the start of the Middle East conflict.
Fuel remains a major cost driver. Emergency bunker surcharges are widely applied across major trades following sharp increases in marine fuel pricing since February. At the same time, European congestion and slower container rotation are increasing equipment pressure, particularly for 40ft high-cube containers.
There are early signs of selective Suez transits returning, but most carriers continue avoiding full Red Sea exposure, meaning transit times and routing strategies remain inconsistent.
Air Freight
Global air freight markets remain operationally fragile despite some stabilisation following the initial disruption caused by the Middle East conflict. Capacity across Gulf-linked corridors remains constrained, while elevated jet fuel pricing continues sustaining high operating costs and surcharge pressure across most major trade lanes.
Worldwide cargo demand softened after strong growth earlier in the year, with global tonnage declining around 3% from March highs. However, broader market activity remains comparatively resilient, supported by e-commerce demand, AI infrastructure shipments and ocean-to-air conversions, particularly across China-US trades.
Capacity recovery also remains uneven. Global air cargo capacity remains below pre-conflict levels, while Gulf-dependent markets continue experiencing significant disruption because of restricted airspace access, redeployed aircraft and longer routings. Bahrain and Kuwait remain among the most constrained markets, while alternative corridors through Turkey and Central Asia are increasingly reshaping cargo flows between Asia and Europe.
Pricing remains significantly above both historical and prior-year levels. Global spot rates during April were around 30% higher year-on-year, supported by elevated fuel costs, constrained capacity and rerouting inefficiencies. Jet fuel continues to trade at a significant premium to crude benchmarks as refined fuel flows remain disrupted through the Strait of Hormuz.
Although pricing momentum is beginning to ease slightly as additional capacity returns, the market remains highly sensitive to further geopolitical disruption, fuel supply instability and inflationary pressure across global consumer markets.
Road Freight
Road freight markets across Europe and North America are increasingly being shaped by fuel inflation, operating costs and structural capacity constraints rather than exceptionally strong demand growth. The continued disruption to refined fuel flows through the Strait of Hormuz has pushed diesel pricing sharply higher, creating sustained upward pressure across both contract and spot transport markets.
In Europe, contract road freight rates continued strengthening through Q1 2026 as carriers passed rising diesel, toll and labour costs into pricing structures. EU diesel prices rose by around 26% during the quarter, while driver shortages and slower fleet renewal continue constraining available transport capacity. Manufacturing activity has improved across parts of Europe, supporting contracted freight demand across major industrial corridors, particularly Germany-linked routes.
The US market is also entering a firmer pricing phase. Less-than-truckload carriers continue increasing rates faster than freight demand is growing, with major operators reporting contract increases of around 6-7% year-on-year. Daily shipment activity rose during Q1, although overall tonnage remained broadly flat, suggesting freight volumes are improving gradually rather than accelerating sharply.
Industry pricing indicators for US LTL freight have reached record highs, while carriers continue reporting stronger yields despite relatively cautious industrial demand conditions.
There are also early signs of manufacturing recovery, including rising shipment weights and improving conditions across selected industrial sectors.
Although weaker consumer confidence and inflationary pressure may limit wider freight growth later in the year, current market dynamics suggest road freight pricing is likely to remain firm through much of 2026, driven primarily by fuel, labour and structural operating cost pressures.
In a market shaped by disruption, cost volatility and shifting capacity, proactive planning is critical. Global Forwarding combines global network reach with strong carrier relationships and global purchasing power to keep costs competitive, even in shifting markets.
Contact us to learn how disciplined planning, modal expertise, and proactive carrier management can help protect your supply chain performance in the most challenging times. Whether navigating congestion, regulatory pressure, or seasonal volatility, our teams are ready to support your next move with confidence.
