Iran War News: Supply Chain Risks and Freight Impacts Week of May 15

Executive Summary

The U.S.-Iran ceasefire enters Day 37 in a “deadlock” as Brent eased to ~$106 and Trump met Xi in Beijing on the war. Strait of Hormuz traffic remains at ~5% of prewar norms with 22,500 mariners stranded. Domestic diesel sits at $5.639/gal, ocean spot rates jumped double-digits this week, jet fuel is still 101% above 2025, and OFAC’s May 1 Hormuz “toll” alert is reshaping compliance for every business shipper touching the Gulf. Iran war news never stops.

Intro 

The ceasefire is still alive. But it’s barely hanging on by a thread. That’s the short version of the latest Iran war news. 

In Tehran just Friday morning, Iran’s foreign minister stood in front of reporters, said he doubts Washington is even serious about negotiating, then casually mentioned that Iran is now talking to Russia about relocating its 440-kilogram stockpile of near-weapons-grade uranium. Meanwhile, a few thousand miles east, President Trump was shaking hands with Xi Jinping in Beijing, who promptly called the war a “disaster.” 

That’s the diplomatic mood on Day 37 of a truce nobody fully trusts, with Brent settling at $105.87, the Pentagon’s war tab hitting $29 billion, and the Senate this week coming within a single vote of yanking the president’s war powers.

Of course, none of which is your job to solve. Your job is moving goods through ports that are watching this war hour by hour, and lanes shifting week after week, in every mode. So we’re back again for another week.

Air Freight: Jet Fuel Down, Rates Up, Capacity Stretched Thin

Jet fuel finally took a breather last week, dropping 10% globally. Before you celebrate, look at the YoY number: prices are still 101% above where they sat at this point in 2025. Air freight is always a wild card. 

‍

• Jet Fuel Eased, But Don’t Get Comfortable: Global average jet fuel landed at $162.89/bbl last week, down 10.1% from the prior week’s $181.11. Year-over-year, though, the price is up 101.3% versus the 2025 average.
• China to U.S. Lanes Hit $6.90 Per Kilo: Spot air rates from China to the U.S. have climbed roughly 15% since the war kicked off, now sitting at $6.90/kg. Electronics, medical devices, and anything else that flies instead of floats pay the premium.
• South Asia to North America Up 75% YoY: Middle Eastern carriers dominate the South Asia to North America corridor, so when their hubs in Doha, Dubai, and Abu Dhabi get squeezed, your rates feel it. The 75% year-over-year jump is the largest on any major air lane right now.
• Europe to Middle East Trade Lane Up 22%: Cargo moving between European and Middle Eastern hubs is paying 22% more than pre-conflict baselines, with Asia to North America up 12% and Europe to Asia up 9% over the same window.  
• IATA Warns Europe Could See Flight Cancellations By End of May: Jet fuel availability on Asia-Europe routes is projected to fall to 78-85% of 2025 levels, and IATA has flagged the real possibility of cancellations across European hubs before the month is out. 

Ocean Freight: Hormuz Still a Ghost Town, Spot Rates Spiking Again

Two and a half months into the Strait of Hormuz closure, traffic is running at 5% of prewar levels, and 22,500 mariners are still stranded on 1,550+ vessels. Carriers spent April absorbing the shock. Now they’re passing it along.

‍

• Hormuz Throughput Stuck at 5% of Normal: The IEA reports crude and fuel flows fell by nearly 6 million barrels per day in Q1, and warns the global oil market stays undersupplied through October even if the war ends next month.
• Drewry WCI Posts Double-Digit Jumps: Shanghai to Genoa jumped 20% to $3,701/FEU on May 14. Shanghai to Rotterdam climbed 11% to $2,413/FEU. Drewry expects further increases next week.
• New FAK Rates Hit Today: Hapag-Lloyd, CMA CGM, and MSC rolled out fresh pricing effective May 15: $3,500-$4,500/FEU Asia to North Europe, $4,500-$4,600/FEU Asia to Mediterranean.
• War Risk Surcharges Hit $4,000 Per Container: Carriers are layering $1,500-$4,000 per container on Middle East corridors. War risk insurance jumped from 0.125% to 0.4% of hull value, and total costs on affected routes are up 125-180% versus precrisis.
• Hapag-Lloyd Lost $256M in Q1: The German carrier posted a $256M Q1 loss with four ships still trapped in the Persian Gulf. Expect more blank sailings and tighter capacity ahead.

Domestic Freight: Diesel Above $5.60, Spot Rates Near Record Highs

Diesel has remained above $5.60 a gallon for two weeks running and up 41% since the war started. Fuel surcharges have tripled, the spring inspection blitz just pulled 31% of inspected trucks off the road, and shippers are moving freight from drayage to rail to outrun the bill.

‍

• Diesel Hits $5.639 Nationally, $7.32 in California: The EIA’s on-highway diesel benchmark sat at $5.639/gal last week, with California at $7.321 and Gulf Coast at $5.152. Goldman Sachs flagged tight global diesel margins as a sign of further supply stress ahead.
• Fuel Surcharges Jumped Across the Board: Truck freight rates climbed about 15% over the past two weeks, with most of that traced to fuel pass-through. Surcharges that typically run 10% of a freight rate have tripled, and shippers are eating the difference on every load.
• CVSA Roadcheck Pulls 31.4% of Trucks Out of Service: The Commercial Vehicle Safety Alliance kicked off its annual International Roadcheck on May 12. Day one produced 1,580 inspections with a 31.4% out-of-service rate, tightening capacity at the worst time
• ITS Index Flags Atlantic and Gulf Ports Elevated: The May Port/Rail Ramp Freight Index from ITS Logistics shows elevated status across Atlantic and Gulf regions, plus outbound capacity issues at West Coast gateways. FTR reports spot market rates approached all-time highs the week of May 8.
• Shippers Are Quietly Moving Drayage to Rail: The Journal of Commerce reports rising diesel costs push shippers to convert drayage and long-haul truckload over to intermodal rail. Norfolk Southern’s CEO even called out coal demand picking back up on the utility side.

Trade Compliance and Sanctions: OFAC Tightens the Screws on Hormuz Passage

OFAC issued three major actions in early May, and every one of them lands directly in the lap of anyone moving freight through or near the Gulf. The Treasury’s “Economic Fury” campaign is now 12 rounds deep, and the rules around vessel due diligence just got sharper.

‍

• OFAC Warns Against Paying Iran’s “Toll” for Hormuz Passage: The May 1 alert warns U.S. and non-U.S. persons against paying any form of “toll” Iran demands for safe passage through the strait, including cash, crypto, swaps, or donations to the Red Crescent or Bonyad Mostazafan.  
• General License W Authorizes Wind-Down of New SDN Additions: OFAC issued General License W on May 1, giving counterparties a limited window to wind down transactions with persons newly blocked that same day.  
• State Department Sanctions Qingdao Haiye Oil Terminal: The May 1 designation hit Qingdao Haiye Oil Terminal in China for receiving tens of millions of barrels of sanctioned Iranian crude via ship-to-ship transfers off Singapore. It’s the 12th round of Iran oil sanctions under NSPM-2.
• Teapot Refinery Alert Raises Bank Due Diligence Bar: OFAC’s April 28 alert tells financial institutions to scrutinize any transactions involving Chinese “teapot” refineries in Shandong Province. Correspondent banks are now expected to communicate sanctions expectations down the chain.
• CENTCOM Blockade Has Redirected 67 Ships So Far: The U.S. naval blockade of Iranian ports has redirected 67 commercial vessels and disabled four for noncompliance over the past four weeks.  

Input Markets and Sourcing: Resins, Helium, Cotton, and Fertilizer All Tightening

The war started as an oil shock. Ten weeks later, it’s a raw materials shock. Lead times on electronics inputs have stretched fivefold, helium supply is in trouble, cotton costs are climbing, and a third of the world’s fertilizer trade is moving through a strait nobody can use.

‍

• Epoxy Resin Lead Times Jumped From 3 Weeks to 15: PCB makers like Daeduck Electronics, which supplies Samsung, SK Hynix, and AMD, are now waiting 15 weeks for epoxy resin versus 3 weeks prewar. Copper foil and glass fiber are also tight, and PCB price hikes are getting passed downstream.
• Qatar’s Ras Laffan Damage Hits Helium and LNG Supply: The damaged Ras Laffan complex accounts for 20% of global LNG and 30% of global helium. Taiwan, which relies on Gulf supply for 37% of its LNG, is feeling it across semiconductor fabs that need helium for cooling and lithography.
• One-Third of Global Fertilizer Trade Stuck at Hormuz: The UN reports up to a third of global fertilizer raw materials transits the strait, and ammonia and nitrogen shipments are now constrained. Bangladesh has shuttered state-run fertilizer plants, and 9.1 million additional people across Asia are projected to face food insecurity.
• Cotton and Textile Production Costs Up 10-15% Globally: Global Textile Times projects worldwide textile production costs climbing 10-15% from the combination of energy, petrochemicals, and shipping. Cotton yarn markets are already moving, which lands square on Memphis-based cotton shippers.
• Saudi Crude Output Hits Lowest Level Since 1990: Saudi Aramco informed OPEC that production has dropped to its lowest point in 36 years, and Iraq’s Rumaila field shut down on storage shortages. Goldman flags refined product scarcity risk in South Africa, India, Thailand, and Taiwan.

We’ve Got Your Back This Week and Every Week

Weeks like this one are exactly why Mallory Alexander has been around since 1925. We’ve moved freight through world wars, oil embargoes, pandemics, and every supply chain shock in between, and the playbook stays the same: steady hands, clear communication, and decisions made with your bottom line in mind. 

The Iran war will keep generating headlines and rate changes for the foreseeable future, and we’ll keep showing up every Friday with the latest.

Iran war news creates real pressure across air, ocean, domestic transportation, and sourcing, but shippers don’t have to handle it alone. Mallory Alexander helps businesses stay ahead of disruption with integrated freight forwarding, warehousing, transportation coordination, and practical trade-compliance support. 

If your team needs help with pressure-testing routes, managing cost exposure, or building a more resilient shipping plan, we’re here for you. 

Contact us to learn more.