Long-Term Contracts Are Absorbing the Crisis
Almost six months of Middle East supply chain disruption have caused a substantial increase in long-term container freight rates. Carriers have gained greater negotiating power and are transferring costs previously concentrated in the spot market into newly signed shipper contracts.
According to Xeneta’s August 13 market update, average long-term rates on major global trades increased by between 17% and 53% from February 28 to August 12, 2026.
Xeneta Chief Analyst Peter Sand said the impact of the conflict is becoming structural. The increase in long-term contracts indicates that the market no longer considers the disruption to be a short-lived event.
Far East–US Contract Rates Rise 40–41%
The average long-term rate for a 40-foot container from the Far East to the US West Coast increased by 41%, rising from $2,028 to $2,854 per FEU.
On the Far East–US East Coast trade, the long-term rate climbed by 40%, from $3,091 to $4,321 per FEU.
The spot market has experienced far more extreme increases. The average spot rate to the US West Coast reached $6,965 per FEU, representing a 271% rise from the end of February. The corresponding rate to the US East Coast climbed 287% to $10,249 per FEU.
The gap between spot and long-term rates on the West Coast trade has widened to $4,103 per container. This difference gives carriers additional leverage to demand higher prices during contract negotiations.
North European Rates Also Increase 41%
Xeneta’s data shows that describing the increase into Europe as 17% overall would be inaccurate. Long-term rates from the Far East to North Europe rose by 41%, from $1,913 to $2,690 per FEU.
The 17% increase applies specifically to the Far East–Mediterranean trade, where the average long-term rate climbed from $2,250 to $2,629 per FEU.
European spot rates have also moved far above their pre-crisis levels. A container from the Far East to North Europe now costs an average of $4,909, an increase of 121%. The Mediterranean spot rate rose by 76% to $5,846 per FEU.
On the North Europe–US East Coast trade, average long-term rates increased even more sharply, rising 53% from $1,385 to $2,123 per FEU.
Why Routes Far From Iran Are Becoming More Expensive
The increase has affected trades that do not normally pass through the Strait of Hormuz because container shipping operates as an interconnected global network.
In June, Xeneta estimated that the blockade had affected approximately 10% of the global container fleet. Before the escalation, 99 container services operated in or transited the Arabian Gulf, deploying approximately 3.2 million TEU of capacity. A substantial number of vessels were subsequently diverted or displaced from regional services.
Longer voyages increase fuel consumption and extend vessel and container turnaround times. Insurance expenses, port congestion, bunker surcharges and frontloading by importers concerned about future capacity shortages are adding further pressure.
Capacity removed from one part of the network can therefore raise shipping costs between Asia, Europe and North America.
Long-Term Deals Create a New Financial Risk
Spot rates reflect the immediate cost of transporting cargo, while long-term agreements can lock elevated prices into company budgets for several months.
Xeneta advises shippers against committing to one-year contracts at the peak of a rising market. Shorter agreements covering the next quarter, combined with adjustment mechanisms if spot rates fall, may offer greater flexibility.
Importers should also evaluate bunker, insurance and emergency surcharges, space guarantees, transit times and compensation terms for cancelled sailings rather than focusing only on the base freight rate.
Rapid Normalisation Is Unlikely
Even a reduction in tensions around the Strait of Hormuz would not immediately restore the container market. Carriers would need time to return vessels to their original services, rebuild schedules and clear accumulated port delays.
As long as spot prices remain substantially above contract rates, shipping lines will retain the ability to push for higher prices in new agreements. Importers may therefore need larger logistics budgets, shorter contracting cycles and earlier capacity reservations on key international routes.
