Middle East Conflict Disruption Updates & Situation Report – March 2, 2026

March 2, 2026 | 10:30 AM EST

Conflict in the Middle East has triggered immediate disruptions across global supply chains. This summary outlines the operational, economic, and cold chain impacts by region, highlighting both short-term bottlenecks and potential longer-term consequences for temperature-sensitive goods.

 

Immediate Supply Chain Disruptions

• All major maritime carriers have suspended bookings for sailings into the Persian Gulf, including “just reefer” cargo, due to ongoing attacks on vessels transiting the Strait of Hormuz.
• Ports are open, but with varying degrees of operational suspensions as they experience drone and missile attacks.
• Spot rates will rise as availability decreases, while wartime insurance provisions and higher premiums may appear.
• Maritime traffic is diverted around the Cape of Good Hope. This will add significant pressure on passage through the Suez Canal in particular, as more freight will switch to this longer route.
• If this conflict continues beyond a few days, we will see significant disruption to the flow of goods between interconnected trade routes, with the first bottlenecks experienced in Asia and the Indian subcontinent.
• Airspace is closed in UAE, Qatar, Kuwait, Israel, Bahrain and Iraq; including major passenger and freight hub airports.

 

Economic Impacts

• Oil and Energy Costs – Export via the Straits of Hormuz accounts for 20% of the world’s oil, with China, Japan and wider Asia markets most exposed.
• Liquified Natural Gas (LNG) – The Middle East faces immediate risk if production is interrupted beyond a few days. In recent years, Europe has relied more on Middle East as a source for LNG since its reduction in reliance on Russian oil.

 

Cold Chain Issues by Region

Middle East (GCC, Iraq, Levant, and Turkey)

• The UAE, Bahrain, and Qatar are all exposed to import disruption to ports that rely on passage through the Strait of Hormuz. Of these, UAE benefits from an alternative port option not affected by the chokepoint. Qatar is most exposed (but also most prepared), and so is likely to cope.
• Countries in this region are major net importers of food, but they export very little. Disruption to global supply chains comes from asset repositioning, not product bottlenecks.

Asia (China, Japan, Korea, India, and ASEAN)

• With significant exposure to energy flow disruption, sustained disruption will mean higher power and transport costs across cold chain.
• The industry may face sudden spikes in the cost of inputs for food processing, along with higher costs to distribute products domestically. Transit and export times could start to be affected by reefer availability problems as assets fall out of position.

Europe (EU and UK)

• The EU is highly exposed to fuel and electricity price inflation. Even if most of its oil and LNG do not come directly from the Middle East, rising global prices will still affect supply costs.
• European Commission President Ursula von der Leyen has sought to reassure markets about the potential impact on energy prices, while also asking EU member states to report on their LNG storage levels.
• If carriers avoid the Suez Canal and Bab el-Mandeb and instead reroute around the Cape of Good Hope, Asia–Europe transit times will be longer and less reliable. This increases spoilage and quality risks and requires higher safety stock levels.
• Container/reefer imbalance: Diversions can leave reefer equipment in the wrong places, spiking spot rates for reefer bookings and generator sets.

Africa (North and Sub-Saharan)

• Energy + food inflation risk is acute in import-dependent markets; cold chain operators face rapid cost increases with limited ability to pass-through.
• Red Sea/Bab el-Mandeb instability specifically impacts East Africa and Egypt: diversions reduce schedule reliability, delay reefer spares, and increase landed cost of temperature-sensitive imports/aid.
• Port congestion + limited reefer plug capacity becomes a bigger problem when vessels “bunch” after diversions.

Latin America (Brazil, Mexico, Andean, and Southern Cone)

• Higher bunker/diesel costs raise inland refrigerated transport prices and can erode export competitiveness (protein, fruit, seafood).
• Reefer container availability and rates can worsen if global equipment gets tied up on longer routings elsewhere (like Cape of Good Hope diversions) and carriers reposition assets.
• Longer transit times to Europe/MENA can pressure shelf-life for fresh exports.

North America

• Fuel-driven cost inflation: diesel and jet fuel are immediate cost lines for refrigerated trucking and time-critical pharma lanes; broader inflation expectations can rise with oil spikes.
• Energy-driven increases in feed, fertilizer, and packaging costs will raise upstream costs for temperature-controlled products. Knock-on ocean disruption: longer Europe/Asia routings can alter global container positioning, indirectly tightening reefer equipment and raising booking uncertainty even on transpacific/Atlantic services.
• Airfreight network effects: If overflight paths or routes through the Middle East are restricted, long-haul cargo flights may need to take longer alternative routes. This can increase transit times and costs, with particularly significant impacts on pharmaceutical shipments.

Oceania (Australia and New Zealand)

• Fuel and electricity costs lift operating expenses for remote, long-line refrigerated distribution.
• Export lane volatility: If refrigerated container capacity shifts to higher-paying, disrupted trade lanes, exporters may face tighter space, fragmented schedules, and increased rate volatility.

 

For additional information, contact Shane Brennan, Senior Vice President, Global Policy, Projects & Partnerships: sbrennan@gcca.org