War Prices & Price Wars & Key Takeaways

The Iran war has triggered a war inflation surge in energy, oil, gas, and transport costs, driving up production expenses across goods and services and risking reduced consumption and investment.

Raising interest rates could worsen this supply-side inflation by further contracting demand amid rising logistics costs, prompting calls for fiscal measures like tax cuts on fuels and electricity to support businesses and households, as urged by the European Commission.

📉 Energy cost spikes amplify operational margins squeeze
⚓ Transport cost hikes disrupt freight efficiency
📋 Fuel tax burdens inflate regulatory compliance costs
🌍 Iran war escalates Middle East tensions

Euro Area Trade Deficit Widens to €1.9 Billion in January 2026

The euro area recorded a €1.9 billion trade deficit in goods with the rest of the world in January 2026, widening from €1.4 billion in January 2025 and reversing a €11.2 billion surplus from December 2025.Exports fell 7.6% year-on-year to €215.3 billion, while imports declined 7.3% to €217.2 billion, reflecting weaker global demand.[1][2][5]

Sectoral weaknesses drove the deterioration, with chemicals surpluses narrowing from €24.6 billion to €16.7 billion and machinery/vehicles from €5.6 billion to €1.6 billion, though energy deficits improved from €26.2 billion to €19.2 billion; exports to the US plummeted 27.8%.[3][4][5] The EU mirrored this with a €5.9 billion deficit, up from €5.4 billion, amid 2025’s annual surplus shrinking to €149.9 billion from €159 billion.[1][5]

📉 Widening deficits signal demand slowdown risk
⚓ Reduced trade volumes strain freight capacity
📋 Stable regulations but monitor US tariff threats
🌍 US export plunge amid global trade tensions

Rates Rising as Gulf Air Cargo Capacity Partially Recovers

WorldACD reports that air cargo rates continue to rise in week 11 of 2026 amid a partial recovery of capacity in the Gulf region, following disruptions from regional military escalations involving the US, Israel, and Iran that led to widespread airspace closures and flight cancellations.[1][3][6]

Gulf airlines like Emirates, Etihad, and Qatar Airways are resuming limited operations at key hubs such as Dubai, Abu Dhabi, and Doha, signaling phased resilience, though full hub and long-haul recovery may take 6-10 weeks due to fleet repositioning and regulatory confidence-building; this supports stabilizing global tonnages amid ongoing volatility.[2][6]

📉 Airspace closures heighten operational disruptions
⚓ Longer routes and higher fuel costs impact freight flows
📋 Limited regulatory caveats on resumed services
🌍 US-Israel-Iran tensions drive regional aviation uncertainty

Energy Crisis Reshapes U.S. Maritime Logistics as Trump Administration Suspends Jones Act for 60 Days

The Trump administration issued a 60-day Jones Act waiver on March 18, 2026, temporarily suspending a century-old maritime regulation that requires cargo between U.S. ports to be transported on U.S.-built, U.S.-flagged vessels.[1][3] The waiver, set to expire May 17, 2026, permits foreign-flagged vessels to transport oil, natural gas, fertilizer, coal, and at least 659 covered products across U.S. ports.[3][9] This action responds to severe supply chain disruptions triggered by ongoing U.S. military operations against Iran, which have effectively closed the Strait of Hormuz—a critical waterway through which approximately one-fifth of global oil and liquefied natural gas supplies transit.[3] Oil prices have surged toward $100 per barrel, and the administration justifies the waiver as necessary to support military operations under “Operation Epic Fury” and ensure adequate fuel supplies to U.S. military installations.[1][9]

The waiver represents a rare exception to the Jones Act’s strict application; historically, waivers are granted only in exceptional circumstances and face significant political opposition from the U.S. shipping industry concerned about impacts on domestic maritime employment.[1] The administration has also released 172 million barrels from the Strategic Petroleum Reserve, with the Jones Act suspension enabling rapid transport of these reserves to U.S. ports within the 60-day window.[9] However, legal scholars debate whether the statutory requirement for an “immediate adverse impact on military operations” is adequately satisfied by the administration’s justification.[11] This suspension underscores broader supply chain vulnerabilities and the cost burden of the Jones Act during crisis periods, as foreign vessels can transport cargo at significantly lower costs than the constrained U.S.-flag fleet.[7]

📉 Foreign competition temporarily reduces shipping costs for energy commodities, but reverting to Jones Act compliance in 60 days may cause logistics cost spikes.
⚓ Waiver enables unrestricted transport between U.S. ports including Alaska and Hawaii, alleviating island supply chain bottlenecks during energy shortage.
📋 CBP issued CSMS guidance on March 18 establishing implementation protocols; waiver covers 659 HTS-classified products with no geographic or route restrictions.
🌍 Strait of Hormuz closure from Iran conflict creates global energy market instability, making U.S. domestic supply chains critical to military readiness and economic stability.

Smart Exporting: Strategies for Global Market Competitiveness

Chilean startup NotCo exemplifies successful international expansion, starting as a plant-based food innovator in Chile and rapidly entering demanding markets like the United States with products such as NotMilk and NotBurger[1][2][4]. The company’s growth highlights how startups with strategic vision can compete globally, leveraging AI-driven development for plant-based alternatives that replicate animal products’ taste and texture[5][7].

NotCo’s approach includes geographical expansion into the US, Canada, Mexico, Brazil, Argentina, and beyond, supported by significant funding like an $85 million Series C round and partnerships with Burger King and Kraft Heinz to boost market penetration[2][4][6][7]. Despite pushing back group-wide profitability to 2027, its Latin American operations show strong growth, securing market shares in categories like burgers and dairy while planning further B2B and product diversification[3][9].

📉 Scaling production amid delayed profitability to 2027 raises supply chain costs[3].
⚓ Product diversification demands efficient freight to diverse markets like US and Europe[2][12].
📋 Customs adaptation needed for plant-based imports across varying regulations[5].
🌍 Rising global demand for sustainable foods aids expansion amid trade connectivity[1][2].

Andalusian Exports Hit €3.201 Million in January 2026 with €320 Million Surplus, Defying Spain’s Deficit

Andalusia recorded exports of €3.201 million in January 2026, marking a strong start to the year with a €320 million trade surplus in its commercial balance with abroad. This performance positions the region as the only top exporting community achieving positive saldo amid national challenges.

Contrasting sharply with Spain’s overall trade deficit, Andalusia’s result underscores its competitive edge, driven historically by robust sectors like agri-food and olive oil, as seen in prior records such as €3,620 million exports in January 2024 and €2.5 billion in olive oil in 2016[1][2]. Recent trends show continued strength in food exports, with 2024 totals reaching €40.173 billion nationally for the region[3].

📉 Low operational risk from surplus stability
⚓ Boost to port freight volumes in Seville and Algeciras
📋 Minimal customs delays expected
🌍 Favorable amid EU trade normalization

Idle Container Fleet Remains at Record Lows Despite Middle East Disruptions

The global fleet of idle container ships has shrunk further in early 2026, reaching just 0.6-0.8% of total capacity amid ongoing avoidance of high-risk routes like the Red Sea and Strait of Hormuz.[1][3][11] Shipping lines reduced inactive tonnage by 13 vessels (87,345 TEUs) in recent weeks, as Cape of Good Hope detours create artificial demand that sustains high fleet utilization despite new capacity additions.[1][5]

Major carriers including MSC, Maersk, Hapag-Lloyd, and CMA CGM have suspended Gulf bookings, imposed war risk surcharges up to $2,000 per 20-ft container, and reverted to longer Africa routes adding 10-15 days to voyages, propping up spot rates and on-time reliability at just 10%.[2][6][10] This maintains near-full employment of the 33+ million TEU fleet, even as overcapacity looms from 10 million TEU on order and weak demand post-Chinese New Year.[9][11][13]

📉 Heightened war risk keeps idling below 1% via route extensions
⚓ Rerouting causes port congestion and capacity shortages
📋 Surcharges and EoV declarations disrupt bookings
🌍 Iran-US tensions escalate Red Sea/Hormuz threats

Webinar on EU-UK Gibraltar Agreement Customs Application Now Accessible

On March 19, a webinar was held to explain the customs application of the EU-UK Agreement regarding Gibraltar, covering general aspects for EU goods, third-country merchandise, indirect taxation, and traveler circulation. The recorded session is now available via a provided link with access code s2%UBbWv, aiding stakeholders in understanding implementation details.

[1][9]

This seminar supports the broader EU-Gibraltar customs union, which eliminates physical barriers at the land frontier while maintaining necessary controls through Spanish customs offices like Algeciras for seamless goods flow. It aligns with the treaty’s goals of free circulation without duties or quotas, replacing Gibraltar’s import duties with a new Transaction Tax starting at 15%, rising toward EU VAT levels, effective around April 2026 post-ratification.

[1][2][4][5][9]

📉 **Minimal implementation delays**
⚓ **Freer Gibraltar-EU sea/land freight**
📋 **Shift to Transaction Tax and EU standards**
🌍 **UK-EU treaty resolves post-Brexit frontier**

AI Investment Boom vs. Middle East Conflict Shapes 2026 Global Trade Outlook

Global merchandise trade growth is projected to slow to 1.9% in 2026 from 4.6% in 2025, driven by fading momentum from last year’s AI surge in data centers, semiconductors, and high-tech goods, now countered by Middle East conflict risks.[1][4]

The WTO baseline assumes stable energy markets, but persistent high oil and LNG prices from Strait of Hormuz disruptions could slash growth to 1.4%, severely impacting energy importers, services like transport and travel, and food supplies, while sustained AI investment could offset losses and boost recovery.[1][2][4][8]

📉 Elevated energy costs threaten production slowdowns
⚓ Strait of Hormuz traffic near zero disrupts shipping
📋 Higher insurance and force majeure complicate clearances
🌍 Iran war escalates oil shocks and regional instability

MSC Updates Emergency Fuel Surcharge on Europe and Mediterranean Routes

Mediterranean Shipping Company (MSC) is updating its emergency fuel surcharge (EFS) for routes involving Europe and the Mediterranean, effective from mid-March 2026 across multiple trade lanes including to the Red Sea, East Africa, Australia, and intra-European short-sea trades, in response to surging bunker fuel costs.[1][2][9]

These surcharges, varying by route and container type (e.g., $30-$120 per TEU for dry/reefer from Mediterranean/Black Sea to Red Sea/East Africa, or $200/$300 per TEU to Australia), will apply until further notice based on sailing, gate-in, or pro-forma dates, with cargo discharged at designated ports amid ongoing market disruptions.[1][2][5][9]

📉 Increased operational costs from fuel surges raise voyage expenses
⚓ Higher freight rates on Europe-Mediterranean lanes impact shippers
📋 No direct customs changes; standard surcharges apply
🌍 Bunker spikes tied to Middle East tensions

EU-India FTA to Boost Ro-Ro Trade and Balance Shipping Lanes

The EU and India finalized a free trade agreement on January 27, 2026, initiating phased tariff reductions on 96.6% of EU goods exports to India by value, projected to save €4 billion annually in duties and double exports by 2032[1][2][3]. This includes slashing India’s car tariffs from 110% to 10% under an annual quota of 250,000 vehicles, alongside cuts on machinery, chemicals, and pharmaceuticals[1][2].

The automotive sector stands to gain most, enhancing ro-ro services for cars and heavy cargo on the Europe-India lane, which saw disruptions in 2024 but recovery in 2025 with MOL and Grimaldi expanding sailings[1]. India-Europe ro-ro flows have been steadier, signaling India’s rise as an export hub, with the FTA expected to balance bidirectional trade and realign supply chains upon entry into force in 2026-2027[1].

📉 **Imbalanced lane volatility** easing with steadying sailings
⚓ **Ro-ro capacity growth** from MOL, Grimaldi expansions
📋 **Phased tariff quotas** on vehicles, machinery easing customs
🌍 **Strategic EU-India pact** covering 25% global GDP, one-third trade

Spain’s Government Offers Sole 20-Cent Diesel Subsidy for Professional Hauliers Amid Rising Fuel Pressures

The Spanish Government has designated a 20-cent per liter subsidy on professional diesel (gasóleo profesional) as its only direct measure to support transport operators, echoing a similar 2022 initiative amid current fuel price spikes linked to Middle East tensions.[1][2][6]

This limited relief comes as the transport sector faces heightened costs from diesel price surges, with no broader fuel aid or tax cuts planned despite union calls for transparency and price controls; meanwhile, focus shifts to e-mobility incentives under the new Plan Auto+ and Sustainable Mobility Law pushing electrification and regulatory deadlines by 2030.[1][2][3][5]

📉 **Rising diesel costs strain carrier margins**
⚓ **No direct port or freight rate relief**
📋 **Targeted tax measures for road transport**
🌍 **Middle East war fuels energy price hikes**

Dry Bulk Market Sustains Momentum Despite Supply Headwinds in 2026

The dry bulk shipping market entered 2026 with unexpectedly strong performance, defying seasonal trends and posting rates well above historical averages across all vessel classes.[5] January saw Capesize vessels averaging $21,250 per day—72% above the 10-year average for the month—while Panamax, Supramax, and Handysize all exceeded their decade averages by 17–27%.[5] This broad-based strength reflects improved trade visibility and supportive ton-mile fundamentals, particularly from shifting commodity flows including increased grain shipments following the US-China trade agreement and robust iron ore movements from Brazil and West Africa.[2][5]

However, the market faces structural challenges as supply growth accelerates. The dry bulk fleet is expected to grow by 3.3% in 2026—its fastest rate since 2022—with approximately 15–16 million deadweight tons of newbuildings scheduled for delivery, compared to around 10 million in recent years.[1][9] Ship demand is forecast to grow only 2–3% annually, while supply is projected to rise 2.5%, creating a supply-demand imbalance that could pressure freight rates particularly in the Panamax and Supramax segments later in 2026.[1][3] BIMCO anticipates the market will remain broadly balanced through 2026 before weakening in 2027 as fleet growth increasingly outpaces demand.[3]

📉 Accelerating newbuild deliveries, especially in Panamax and Supramax segments, expected to pressure rates in H2 2026
⚓ Grain trade supported by US-China soybean agreements; minor bulk demand bolstered by bauxite and steel exports from Asia
📋 Red Sea normalization and geopolitical tensions may influence routing patterns and compliance requirements as the year progresses
🌍 China’s economic trajectory and trade policy remain critical swing factors, though recent stimulus measures have improved near-term outlook

ICS Releases Fifth Edition Guidelines on ILO Maritime Labour Convention Updates

The International Chamber of Shipping (ICS) has published the fifth edition of its Guidelines on the Application of the ILO Maritime Labour Convention (MLC), incorporating recent amendments agreed upon by governments, shipowners, and unions at the ILO’s Special Tripartite Committee meeting in Geneva from April 7-11, 2025[1][3][8]. These updates address evolving seafarer needs, including enhanced protections against violence and harassment, recognition as key workers, improved shore leave access without visas, and mandatory carriage of the ICS International Medical Guide for Seafarers[1][3].

The guidelines provide practical advice for shipowners to ensure compliance amid ongoing MLC revisions, such as those from 2022 on social connectivity, balanced diets, and PPE for women seafarers, with UK regulations implementing these in 2026 after a delay[2][4][5]. Complementary resolutions aim to align MLC with IMO standards on hours of work and rest, supporting global enforcement through flag and port state control[1][3][7].

📉 Minimal operational risk with proactive compliance preparation
⚓ No direct impact on freight rates or port operations
📋 Increased regulatory scrutiny via port state control inspections
🌍 Strengthens global seafarer standards through ILO tripartite consensus

eTIR Implementation Tops IRU Customs Agenda

The IRU Commission on Customs Affairs held a virtual meeting to prioritize the rollout of the eTIR system across Europe and worldwide, aiming to boost competitiveness and digitalization for cross-border transport firms amid ongoing supply chain pressures.[1]

Members discussed legislative enhancements, practical steps for eTIR connectivity via direct links or UN tools, and related digital initiatives like ICS2 and e-CMR, with the first fully operational corridors targeted for this year; the next in-person meeting is set for Ankara in September 2026.[1][3]

📉 Minimal risk from delays in adoption amid polycrisis pressures
⚓ Supports road freight resilience against air/sea disruptions
📋 Accelerates digital customs transit with TIR-EPD integration
🌍 Enhances global trade efficiency post-Middle East conflict

📚 Sources:

1. Precios de Guerra y Guerra de Precios
2. Euro area international trade in goods deficit €1.9 bn
3. WorldACD Weekly Air Cargo Trends (week 11)
4. Supply Chain and Logistics News March 16th-19th 2026
5. Exportar con inteligencia: estrategias para ser competitivo en mercados globales
6. Las exportaciones andaluzas llegan a 3.201 millones en enero de 2026, con un superávit de 320 millones, frente al déficit de España
7. Flota de portacontenedores inactivos sigue en mínimos pese a disrupciones en Medio Oriente
8. Acceso al la grabación del Seminario Aplicación del Acuerdo UE/GB con respecto a Gibraltar
9. La inversión en IA y el conflicto en Oriente Medio configuran las perspectivas del comercio mundial
10. MSC actualiza recargo por combustible de emergencia en rutas de Europa y Mediterráneo 
11. EU–India FTA set to rebalance ro-ro services
12. SECTOR | La ayuda de 20 céntimos por litro al gasóleo profesional es la única medida del Gobierno para los transportistas
13. Will it be onwards and upwards for the dry bulk market in 2026?
14. Updates to Guidelines on the Application of ILO Maritime Labour Convention
15. La implementación del eTIR sigue siendo una prioridad para el transporte internacional