Why are trans-Pacific rates rising when demand is traditionally low?

The Strait of Hormuz blockade and Iran conflict have driven up fuel and bunker costs, which carriers are passing through to shippers via surcharges. Even though this is a seasonal low-demand period (post-Lunar New Year, pre-peak season), reduced supply and higher operating costs are preventing the typical floor-level pricing that usually occurs during this window.

How do trans-Pacific rates compare to other trade lanes right now?

Asia-Europe rates have eased 3% and are only 8% higher than pre-war (North Europe at $2,668/FEU), while Asia-U.S. routes remain elevated at $2,675–$3,939/FEU. This divergence reflects different supply-demand dynamics: carriers have blanked more sailings on Europe routes and cancelled GRIs (Maersk cancelled an Asia-Europe GRI), while Pacific lanes continue to see gradual demand recovery.

What does this mean for peak season in June-July?

Analysts expect significant rate increases in June-July as peak season demand materializes, but war-related cost pressures on consumers may dampen shipper volume expectations. The combination of structural cost inflation and potential demand softness creates uncertainty about whether peak season pricing will follow historical patterns.

Are current rates higher than earlier 2024 disruptions like the Red Sea crisis?

No. Current trans-Pacific rates are well below the peaks triggered by Red Sea disruptions and trade war frontloading. West Coast rates today ($2,675/FEU) remain significantly lower than those earlier spikes, suggesting this conflict's impact, while sustained, is less severe than recent precedents.

What fuel costs are driving these rate increases?

Brent crude has climbed to $121/barrel for June contracts, and U.S. diesel prices have exceeded $5/gallon. Bunker fuel volatility is a key cost driver for ocean carriers, who are incorporating these expenses into spot rates and surcharges rather than fully absorbing them.

Shipping & Freight

High Impact

Iran Conflict Keeps Trans-Pacific Rates High Despite Low Demand

Apr 30, 2026

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The signal

S. blockade of the Strait of Hormuz are creating an unusual market dynamic on trans-Pacific shipping lanes: elevated container rates during a period of traditionally low demand. S. West Coast spot rates climbed to $2,675/FEU (up 1%), while East Coast rates reached $3,939/FEU (up 3%), buoyed by higher fuel costs despite what should be the year's lowest-price season.

This contradicts Asia-Europe lanes, where rates have largely stabilized near pre-war levels, suggesting regional supply-demand imbalances rather than a purely geopolitical story. For supply chain professionals, this presents a strategic puzzle: shippers face elevated costs during a cyclically weak period, which may squeeze margins and discourage peak-season volume commitments. The Freightos Baltic Index and SONAR data show rates have climbed 45% on the West Coast and 30% on the East Coast since late February, but remain 15-20% below earlier Red Sea disruption spikes. Carriers are managing capacity through blanked sailings and GRI cancellations on Asia-Europe, signaling confidence that demand pressure will ultimately cap rate gains.

Looking ahead, supply chain teams should prepare for potential June-July peak season volatility. Elevated energy costs could dampen consumer demand, creating a mismatch between available capacity and actual shipper volume. The confluence of geopolitical uncertainty, bunker fuel volatility (Brent crude hit $121/barrel), and diesel surcharges ($5+/gallon) suggests that operational planning must now account for sustained higher transportation costs as a structural feature, not a temporary shock.

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What This Means for Your Supply Chain

Simulation Suggestion

this month

What if Strait of Hormuz remains blocked through Q3?

Simulate sustained bunker fuel cost elevation (increase bunker costs by 15-20% above baseline) on trans-Pacific and Asia-Europe ocean shipping lanes through Q3 2024. Model impact on container spot rates, carrier profitability, and shipper landed costs across automotive, electronics, and consumer goods sectors.

Run this scenario

Simulation Suggestion

strategic

What if peak season demand fails to materialize in June-July?

Simulate a 15-20% reduction in typical peak season shipping volumes due to consumer cost sensitivity and war-related economic uncertainty. Model the impact on carrier utilization, rate stability, and inventory planning decisions for retailers and electronics importers relying on summer shipments.

Run this scenario

Simulation Suggestion

this month

What if carriers expand blanked sailings to manage capacity?

Simulate increased blank sailings (reduce available capacity by 10-15%) on trans-Pacific routes if demand remains soft and carriers overestimate summer volumes. Model the impact on shipper transit time reliability, space availability, and premium charge exposure.

Run this scenario

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