The renewed military conflict in the Persian Gulf kept the Strait of Hormuz shut last week, but Maersk and CMA CGM have continued to send their ships through the Red Sea despite the increased risk of Houthi attacks. Although only 24 containerships remain idle in the Persian Gulf with a total capacity of 69,000 teu, there is a growing number of Iranian ships that are stranded in various Asian anchorages that have been added to the idle fleet. The rising tensions is giving container freight rate futures a renewed boost as bunker fuel prices have risen by 20% over the last 2 weeks. The SCFIS on both the North Europe and US West Coast routes rebounded on 20 July, defying last Friday’s 3.3% SCFI decline.
Capacity remains tight with extra loader demand on both Asia-Europe and US West Coast still intact despite the recent correction in spot freight rates. Port congestion across East Asia remain elevated as vessels delayed by Typhoon Bavi last week are still being cleared even as new arrivals result in further vessel bunching. Charter rates continue to edge upwards with vessel demand expected to remain firm until the end of the year.
Johnson Leung
Chinese owners lead Panama flag exodus
101 containerships have switched out of the Panama flag since the beginning of 2026 as the detentions of Panama-flagged container vessels at Chinese ports under Port State Control have surged by 700% since March this year. Chinese owners account for 56 of the 101 units that have switched out of Panama, while the remaining 45 ships are controlled by owners from 14 different countries of domicile according to data analyzed by Linerlytica. The exodus has reduced the total number of Panama flagged containerships by 12%, with the remaining 731 Panamanian-flagged ships also at risk.
The US Federal Maritime Commission claims the Chinese actions are in retaliation against the Panamanian Supreme Court’s invalidation of CK Hutchison’s port concessions at Balboa and Cristobal in January, raising the risk of reciprocal US regulatory pressure on Chinese-controlled carriers.
Register Free Trial
Weekly/Monthly Market Pulse: US$1,500/US$1,800 per year