Transport: BofA Freight Follower: An early peak season?

Research evidence excerpt

Transport: BofA Freight Follower: An early peak season?

Accessible version

Transport

BofA Freight Follower: An early peak

season?

Industry Overview

Iran conflict: Hormuz remains in lingo; Suez still shut 04 June 2026

The Iran conflict remains protracted with signs of de-escalation dragging on. Hormuz Equity

transits fell to ~10 in May (vs 14 in March, ~130 in February). Disruptions have Global

broadened, driving congestion across the Indian subcontinent and Saudi Red Sea ports Transport

amid higher transshipment demand. Vessel speeds remain below pre-crisis levels due to Muneeba Kayani >>

elevated bunker costs (despite modest May uptick). Container ship Suez transits declined Research Analyst

4% m/m in May but are up 16% y/y, with a full normalisation not yet in sight. MLI+44 (UK)20 7996 5208

muneeba.kayani@bofa.com

Sea: Peak season starts early Kate Xiao, CFA >>

Following a stable April (+3%), spot rates rose +35% in May with Asia–Europe and Asia– ResearchMLI (UK) Analyst

USWC up +63% and +52% respectively. This partly reflects higher bunker costs (average +44 20 7996 3051

kate.xiao2@bofa.com

bunker rose +13% in May vs -7% in April) and an earlier-than-usual seasonal demand

Jack Raeburn >>

ramp, with potential Middle East disruptions and US tariffs in focus ahead of the Research Analyst

summer peak. Freight rates should remain firm into at least late July, as carriers continue MLI (UK)

+44 20 7996 3374

to monetise peak season strength. Following the successful 1 June GRI and surcharge jack.raeburn@bofa.com

implementation, liners are targeting further mid-June increases. Freight futures indicate

further acceleration, with markets still pricing ~48% upside by end-June versus 1 June

levels, signalling continued near-term tightening.