DP World terminal in Jeddah Port, Saudi Arabia. Image Credit: DP World

A two-week US-Iran ceasefire will not restore container shipping through the Strait of Hormuz to pre-conflict conditions, with disruption and high freight rates set to continue, according to ocean and freight analytics firm Xeneta.

Container shipping lines are expected to maintain alternative routings via Khor Fakkan, Sohar, and Jeddah while testing limited transits through the Strait, it said in an email update commenting on the impact of the latest conditional ceasefire on Wednesday.

"The ceasefire should come with a dose of reality because there is unlikely to be a rapid return to normality for container shipping in the Middle East, Peter Sand, chief analyst at Xeneta, commented.

“Strait of Hormuz transits are likely to increase but how this transition is managed is yet to be seen because two weeks is a very short window of opportunity and there is no guarantee the ceasefire will hold.”

Despite the two-week ceasefire announced by US President Donald Trump on Tuesday, drone and missile strikes continued on Wednesday, highlighting the fragile security environment.

"The conflict has displaced 250,000 TEU of weekly container shipping capacity and carriers have put a lot of effort and expense into establishing alternative routings to allow goods to flow into the region, Sand added.

“You do not suddenly toss that out of the window because there is a two-week ceasefire."

Congestion Remains Severe Across Regional Ports

Ports such as Jeddah and King Abdullah have seen a spike in weekly container calls.

“Weekly capacity to Jeddah and King Abdullah port has increased 19% as carriers introduce new services to connect the landbridge into the Gulf region, Destine Ozuygur, Senior Analyst at Xeneta, said.

"Even with alternative routings, there is huge schedule disruption at ports like Mundra, Nhava Sheva, and Khor Fakkan — and that is not going to go away overnight.”

Container freight rates remain elevated, with China-Jebel Ali spot rates up over 270% since end-February, while China-US West Coast rates have risen 37%.

“I would expect short-term rates to go a bit higher, simply because there is a two-week window of opportunity and everybody is in a rush,” Sand said.