What Happened
The Strait of Hormuz connects the Persian Gulf to the Gulf of Oman and the open ocean. Approximately 20% of the world's oil supply passes through this 21-mile-wide channel. When military operations disrupted transit in early March, the immediate effect was a 70% drop in tanker traffic. Oil prices spiked from $85 to over $126 per barrel within two weeks. While a selective passage arrangement allows vessels from India, Saudi Arabia, and a few other nations to transit, most commercial shipping has rerouted around the Cape of Good Hope — adding 10 to 14 days to Asia-Europe routes.
The Diesel Price Ripple
North American freight runs on diesel. When crude oil prices jump 48% in two weeks, diesel follows. US diesel prices have risen from $3.70 to $4.40 per gallon in March 2026, with further increases expected. For a long-haul truck burning 6 miles per gallon on a 1,500-mile run, that is an additional $175 in fuel cost per load. Across thousands of loads per month, the cost adds up. Carriers pass these increases through via fuel surcharges, which typically adjust weekly based on the DOE national average. Shippers should expect fuel surcharges to remain elevated through at least Q2 2026.
Ocean Container Rates
The rerouting of container vessels around the Cape of Good Hope adds 10 to 14 days to Asia-Europe sailings. This pulls vessel capacity out of the market — ships that would normally make four Asia-Europe rotations per year can now only make three. The capacity crunch has pushed container rates up $2,000 to $4,000 per TEU on Asia-Europe lanes. Asia-to-North-America rates have risen sympathetically, up $800 to $1,500 per container, as carriers redeploy vessels. Maersk, MSC, and Hapag-Lloyd have all announced surcharges specifically tied to the Hormuz disruption.
Capacity Tightening Across Modes
The disruption is not limited to ocean freight. As shippers shift from ocean to air for time-sensitive goods, air freight rates on Asia-origin routes have jumped 20 to 30%. Rail intermodal volumes are up as importers move goods inland faster from West Coast ports to avoid warehouse congestion at port-adjacent facilities. Truck capacity on import corridors (LA/Long Beach to Midwest, Newark/Savannah to inland) is tightening as import volumes spike ahead of expected further rate increases.
What North American Shippers Should Do
First, review your fuel surcharge agreements. If your surcharge is pegged to a lagging index, you may be underpaying now but will face a catch-up adjustment. Lock in rates where possible. Second, if you have ocean freight in transit or planned, confirm your carrier's routing and updated transit times. Third, evaluate whether nearshoring or North American sourcing can reduce your exposure to transoceanic disruptions. Fourth, pre-position critical inventory. If you depend on imported components, ordering now — even at elevated rates — beats the risk of production shutdowns if the situation escalates. Fifth, diversify your mode mix. Intermodal rail for domestic long-haul can offset some of the cost pressure from elevated truck diesel prices.
How Long Will This Last
Military and diplomatic analysts offer a wide range of estimates. The selective passage arrangement suggests a complete closure is unlikely to persist, but reduced throughput could last months. Even after transit normalizes, the ripple effects — repositioned vessels, disrupted schedules, elevated fuel inventories — take 60 to 90 days to unwind. Shippers should plan for elevated costs through at least mid-2026 and build flexibility into their supply chains.
Celsius Connect monitors global disruptions and helps shippers adapt with multi-modal flexibility — ocean, air, rail, and truck options to keep your supply chain moving.