European shipping giants AP Moller-Maersk and Hapag-Lloyd both announced on Friday that they have temporarily suspended routes in the Gulf region as fighting escalates in the Israel-US war with Iran.
Maersk said it was stopping its FM1 service, connecting the Far East to the Middle East, and the ME11 service, connecting the Middle East to Europe.
“This decision has been taken as a precautionary measure to ensure the safety of our personnel and vessels while minimising operational disruption across our wider network,” the Danish logistics company said in a statement.
Maersk’s shuttle services in the Gulf region were also suspended until further notice.
In a message to customers on its website, the firm said: “We remain committed to minimising the impact on your supply chain. If however changing conditions require us to make further adjustments or undertake other contingency measures, we will communicate the updates to you promptly.”
German peer Hapag-Lloyd also announced “temporary adjustments” to its Oman Gulf Shuttle and Upper Gulf Shuttle services, as well as removing a Dubai stop (Jebel Ali) from its Pakistan Shuttle service.
The decision to halt these services was made to “maintain reliable service and operational stability”, the company said.
Share prices of both firms were relatively unfazed by the news, with Maersk up 0.5% at DKK17,030 and Hapag-Lloyd unchanged at €139.20 by 1217 GMT, on speculation that the ongoing disruption will prop up freight rates for shipping companies going forward.
In a note on Thursday, ratings agency S&P Global said: “Although our base case assumes that the military confrontation with Iran will be relatively short-lived, broader spillovers and intermittent security incidents beyond this time horizon mean that shipping via the Suez Canal is likely to remain disrupted for longer.
“Consequently, carriers will keep diverting vessels around the Cape of Good Hope, tying up capacity, alleviating the supply-side pressure from new containership deliveries, and supporting freight rates.”