Adverse impacts from the US-Israel strikes on Iran unfolded on Monday, disrupting supply chains, driving up oil prices and leaving many Middle East business leaders at a major trade fair in Hong Kong in an awkward position.
As the strikes entered a third day, oil prices surged 13 per cent – the biggest rise in four years – briefly climbing above US$80 a barrel. Freight costs also jumped due to risks of potential damage passing through the Strait of Hormuz, a narrow passage along Iran’s southern coast.
Sunny Ho Lap-kee, executive director of the Hong Kong Shippers’ Council, said many companies with confirmed orders had chosen to delay dispatches rather than ship immediately.
He said the city’s exporters primarily routed electric vehicles, batteries, low-cost mobile phones and appliances through the Middle East en route to Africa.
“So far we have not seen large-scale order cancellations, but if the situation persists, that possibility cannot be ruled out,” Ho said.
He added that shipping lines were concerned not just about rising freight rates, but also about possible war-risk insurance surcharges needed to protect their crews in conflict zones.
