Middle East Crisis: Risks to Shipping

With the Strait of Hormuz now effectively closed, some ocean carriers are using rules that haven’t been widely applied in decades. Most importers have never had to think about the “liberties clause” in a bill of lading. This clause — rooted in maritime law from the 1800s and formalized under the Hague Rules — gives shipping lines the right to divert or delay voyages, or discharge cargo at a completely different port when continuing the journey becomes unsafe. Right now, that’s exactly what’s happening.

Major ocean carriers including MSC, Maersk, CMA CGM and Hapag-Lloyd are now invoking this clause as security risks escalate in the region. Instead of completing voyages into the Arabian Gulf, some vessels are declaring ‘end of voyage‘, and offloading containers at alternative safe ports. Cargo owners must then arrange onward transport themselves.

What this means in practice: 

• Containers may not arrive at the port listed on the booking
• Cargo may land hundreds of miles from its destination
• Shippers pay all additional costs — re-transport, storage, and handling
• Emergency surcharges are rising rapidly across trade lanes

Air and Ocean Carriers Increasing Surcharges

Both air and ocean carriers are raising fuel surcharges and adjusting them more frequently. Carriers are also announcing war risk surcharges — and not only for Middle East destinations.

War Risk Insurance Cancellations Issued

In the past two weeks, many insurance companies have issued formal Notices of Cancellation for War, Strikes, Riots, and Civil Commotions coverage. Rapid escalation of tensions in the Middle East — including direct conflict involving Iran and disruptions in key maritime corridors — is driving these cancellations.

The cancellations primarily affect cargo moving to, from, or within these high-risk regions:

• Persian/Arabian Gulf
• Gulf of Oman
• Gulf of Aden
• Red Sea
• Certain defined Indian Ocean boundaries
• Exposures involving Iran, Israel, Lebanon, Bahrain, UAE, Djibouti, Kuwait, Oman, Qatar, Jordan, Syria, Saudi Arabia, and Yemen

ACS works with leading insurance markets to provide war risk coverage options even in challenging conditions. If you have an upcoming shipment to any of these areas, contact us — we may be able to arrange alternative protection.

Questions about how these disruptions affect your shipments? Contact ACS at info@acssan.com or (858) 565-4125.