Iran War News: Supply Chain Risks and Freight Impacts Week of May 22

Executive Summary 

The U.S.-Iran ceasefire enters Day 44, with Secretary of State Marco Rubio reporting “slight progress” in talks but rejecting Iran’s Strait of Hormuz tolling system. Brent crude is hovering near $106/bbl, Hormuz traffic remains largely shut, U.S. on-highway diesel sits around $5.60/gal, and OFAC’s May 19 sanctions on Iranian financial and shipping networks have widened compliance exposure for every shipper touching the Gulf.

Intro  

Peace talks are moving. But your freight costs sure aren’t.

Pakistani Army Chief Asim Munir just touched down in Tehran carrying Washington’s latest proposal, and Secretary of State Marco Rubio is telling reporters he sees “good signs” that a deal is in sight. Day 44 of the ceasefire, and the diplomats finally look like they’re earning their per diems.

Of course, though, talk is cheap. Iran’s brand-new Persian Gulf Strait Authority just drew a “controlled maritime zone” across the entire transit lane, Brent is parked near $105 a barrel, diesel is sitting around $5.60 a gallon, and the Treasury slipped another round of sanctions onto Iranian shipping networks.

So what does any of that mean for the freight you have to move? Quite a bit, as you’re well aware of by now. Below we’re back with another weekly Iran war news rundown and the impacts across air, ocean, domestic, compliance, and sourcing.

Air Freight: Jet Fuel Finally Cooled, But Gulf Belly Stays Grounded

Air freight is where shippers go when the ocean fails. Jet fuel finally cooled this week, freight rates took their first real breath in 11 weeks, but Gulf belly capacity is still grounded.

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• Baltic Air Freight Index Falls 4.9% on Fuel Retreat: TAC Index data for the week to May 18 shows the global BAI00 down 4.9%, though rates still run 30.4% above 2025. Hong Kong outbound fell 2.4% WoW and remains 34.3% higher YoY.
• Global Air Cargo Tonnage Down 6% Over Two Weeks: WorldACD week 19 data shows worldwide chargeable weight off 3% WoW, with MESA tonnage down 4%. Dubai-to-USA bucked the trend with a +7% WoW gain.
• MESA Spot Rates Still 56% Above 2025: Middle East and South Asia spot pricing carries the largest YoY inflation of any region. Global spot rates sit 51% higher YoY.
• Jet Fuel Down 10% in Early May, Still Up 80% YoY: Platts data shows jet fuel pulled back about 10% in early May. The YoY gap still sits at 80%. IATA’s Willie Walsh warns Gulf refining damage means months of recovery.
• Gulf Freighter Capacity Recovers, Passenger Belly Stays Stuck: Per WorldACD’s latest analysis, Gulf carriers have restored most freighter operations. Yet, passenger services have not, so belly capacity stays short for time-sensitive cargo.

Ocean Freight: The Persian Gulf Strait Authority Means Business

Tehran spent the last three weeks setting up a brand-new government agency to charge you for the privilege of sailing past it: the Persian Gulf Strait Authority. Predictably, there are consequences for ocean freight moving anywhere near Hormuz and the Gulf.

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• Persian Gulf Strait Authority Officially Operational: Iran launched the PGSA on May 5 with a $2 million transit fee in Bitcoin or yuan. OFAC calls the payment sanctionable, so the choice is fines or reroutes.
• PGSA Declares Controlled Maritime Zone: The authority drew a box around the entire transit lane on May 17 and demands prior authorization. Iran is also negotiating with Oman to make the toll permanent.
• Drewry WCI Climbs 6% to $2,712 in Third Weekly Rally: Drewry’s May 21 print put Shanghai-Rotterdam up 15% to $2,773/FEU, Shanghai-Genoa up 10% to $4,082/FEU, Shanghai-NY at $4,317, and Shanghai-LA at $3,385.
• UAE’s Khor Fakkan Becomes the New Jebel Ali: With Dubai’s flagship port still jammed, Inchcape’s May 18 advisory confirms all six Khor Fakkan berths are running container-only, with breakbulk waits stretching close to a month. DP World is also trucking diverted cargo across the UAE on a new land bridge.
• Maritime Industry Coalition Issues 22-Page Hormuz Transit Manual: ICS, BIMCO, INTERCARGO, INTERTANKO, IMCA, and OCIMF released joint guidance May 20, warning of missile attacks, GNSS interference, AIS manipulation, mines, and congestion. About 20,000 seafarers remain stuck.

Domestic Transportation: The War Lives in Your Diesel Bill

The conflict may be 7,000 miles away, but you’re paying for it every time a truck pulls out of a yard. That’s domestic transportation and the impact of Iran war news in a nutshell. 

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• On-Highway Diesel Eases Yet Sits 57% Above Last Year: The EIA’s May 18 reading dipped 4 cents WoW, and AAA pegged the May 21 average at $5.656/gal. California sits at $6.524/gal and the Gulf Coast at $5.122/gal, so where your DCs live still drives the landed cost.
• LTL Fuel Surcharges Now Run 43-51% of Linehaul: Old Dominion, XPO, and TForce are billing the heaviest, with FedEx Freight close behind at 49.5% surcharges. A line item that once ran 10% of your freight rate is now closer to half.
• Supreme Court Cracks the Broker Shield, Truckload Could Run to $5 a Mile: The Supreme Court ruled unanimously on May 14 that federal law no longer protects brokers from state personal-injury suits. FreightWaves’ Craig Fuller projects 30% of carriers without solid safety ratings could exit the market.
• Tender Rejections Hit 14%, Spot Rates Touch $3.55 a Mile: Carriers are rejecting contract loads at levels not seen since 2022, and spot rates spiked midweek. Capacity is not flowing back in to relieve roadcheck tightness.
• Truckload Employment Sinks to Lowest Level Since February 2014: The non-domiciled CDL crackdown is draining drivers right as Iran-fueled freight demand picks back up.  

Trade Compliance and Sanctions: Treasury Drops 50+ New Iran Designations

OFAC took a swing at Iran’s shadow banking and shadow fleet on May 19. But beyond that, the CENTCOM blockade keeps tightening, and a $15 million bounty just hit the table for IRGC financial intel.  

• Treasury Hits Amin Exchange and 50+ Targets: OFAC’s May 19 action names Amin Exchange (Ebrahimi and Associates), a foreign currency house the Treasury says moves hundreds of millions for sanctioned Iranian banks. Front companies span the UAE, Turkey, Hong Kong, and China.
• OFAC Blocks 19 More Shadow Fleet Vessels: The same May 19 action blocked the Barbados-flagged Great Sail, Palau-flagged Ocean Wave, and Panama-flagged Swift Falcon. St. Kitts-based Romy Lines was named for moving millions of Iranian barrels.
• CENTCOM Blockade Count Hits 90 Redirected Vessels: CENTCOM’s May 20 update put the redirected total at 90 commercial vessels, with four disabled. The count was 81 on May 17 and 67 a month ago.
• State Department Posts $15M Bounty for IRGC Financial Intel: The Rewards for Justice program added a $15 million payout for intel that disrupts IRGC financial mechanisms under E.O. 13902 and NSPM-2.
• Vetting Counterparties Just Got Harder: Amin Exchange’s front companies sit in the same jurisdictions where forwarders, brokers, and trade finance move every day. Screen every vessel owner, manager, charterer, and intermediary before booking.

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Input Markets and Sourcing: Where Iran War News Hits Your Bill of Materials

Freight gets the headlines, but the war hit input markets first. Brent’s currently hovering around $105 a barrel, still 61% above last May, and every commodity below reprices off that barrel. 

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• Cotton Eased Toward 81 Cents/lb: Cotton futures slipped this week on a firmer dollar and softer crude. ICE-certified stocks climbed to 203,491 bales. Cotton’s main rival is polyester, which is made from petroleum, and that runs straight back to Brent.
• PCB Lead Times Hold at 15 Weeks: NCAB Group’s May outlook calls this the worst PCB shock since COVID. Epoxy resin sits at 15 weeks (was three prewar), copper foil is up 30% YTD, and April PCB prices jumped 40%.
• Helium Spot Prices Have Doubled Since March: Iranian strikes on Qatar’s Ras Laffan knocked out roughly 30% of Qatari helium for 2026, or 11% of global supply. Containers last 35-48 days, so fabs and MRI departments are on borrowed time.
• PE Resin Up 20 Cents/lb in April, More Coming: PE, PP, PET, PVC, and ABS are moving together per Plastics Technology’s May report. European spot PE jumped 70-80% February-April. Suppliers want another 10-15 cents/lb on top of April’s 20 cent hike.
• Urea Eased After India’s $2.5B Tender: Urea pulled back in May as buyers shifted to alternatives. India Potash cut a $2.5 billion check for 2.5M tons at $935-959/ton. But be aware: Hormuz handles a third of global fertilizer.

We’ve Got Your Back

That’s the read across air, ocean, domestic, compliance, and sourcing as of today. It’s a lot to track, and you shouldn’t have to do it alone. Sanctions lists, vessel screening, fuel surcharges, resin contracts, and Hormuz transit fees are nobody’s full-time job at your company. They’re ours at Mallory Alexander, and we’ve been doing this work for over a century.

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.