World News
Hapag-Lloyd Sees $40-50 Million Weekly Cost Surge Amid Iran Conflict
German container shipping firm Hapag-Lloyd is facing additional costs of $40 million to $50 million per week due to the Iran conflict, driven by higher bunker fuel prices, insurance premiums and container storage expenses.
“Costs are increasing sharply,” Rolf Habben Jansen, CEO of Hapag-Lloyd, said on an earnings call on March 26.
“If we look at the impact that this has on us, then we talk easily about $40 million or $50 million per week that we are facing at this point in time,” he added.
Jansen said the increase is primarily driven by higher bunker costs, alongside additional pressure from insurance and storage expenses.
He added that the carrier has introduced contingency and emergency charges to recover the additional costs, noting that cost recovery is typically subject to a lag.
Hapag-Lloyd continues to divert ships away from the Strait of Hormuz and the Red Sea.
He said the company had been moving closer to resuming Red Sea transits but has held back due to the ongoing conflict.
Jansen warned that if the conflict persists, it would not be positive for global trade.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 867.50 | 10.00 | 1869.50 | 48.00 |
| Rotterdam | 749.00 | 11.00 | 1366.50 | 22.00 |
| Houston | 895.00 | 12.50 | 1267.00 | 75.50 |
| Fujairah | 869.00 | 21.50 | 1730.00 | 27.00 |
| Global 20 Ports Average | 965.00 | 6.50 | 1694.00 | 3.00 |
| Global 4 Ports Average | 845.00 | 7.50 | 1558.50 | 19.00 |
| Global Average Bunker Price | 1007.50 | 0.50 | 1649.00 | 50.00 |
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