With a preliminary agreement on a Memorandum of Understanding (MoU) to end the United States-Iran conflict between the nations now intact, a key emphasis for supply chain stakeholders will be on getting operations back to pre-conflict conditions.
Strait of Hormuz Closure Disrupted Global Energy Flows
When the conflict began in late February, with joint strikes launched by the United States and Israel on Iran, in an initiative geared toward halting Iran’s development of nuclear weapons, various logistics- and supply chain-related issues were raised, including the likelihood of higher energy prices, which came to fruition, but are now seeing declines, as well as restricted shipping lanes in and around the Middle East, which was seen with the closure of the Strait of Hormuz, which handles about 20% of the world’s petroleum supply (roughly 20 to 21 million barrels ) and about 20% of global liquefied natural gas (LNG).
Diesel Prices Peaked at $5.643
The impact of higher energy prices resultant of the conflict quickly became clear, with the national average price of diesel gasoline getting as high as $5.643 for the week of April 6. Prior to that, the highest average price in prior week came during the week of May 9, 2022, when it was at $5.623. What’s more, those high diesel prices led to various logistics services providers upwardly adjusting fuel surcharges and rates to offset the rapid and steep gains in diesel prices.
U.S.-Bound Imports Fell 93.2% Year-on-Year
The impact of the conflict, in terms of U.S.-bound imports departing from Strait of Hormuz-affected ports was significant, with data from Descartes showing that total U.S.-bound imports fell from 1.5 million metric tons in May 2025 to 100,591 metric tons in May 2026, for a 93.2% annual decline.
60-Day Negotiation Period and Naval Blockade Timeline
Reuters report, the Strait of Hormuz is starting to reopen, as agreement, while there is not a set date for a full return to normal operations. And it added that limited traffic may increase over the next several days, with a complete return to normal likely to take weeks to months.
Under the terms of the MoU between the U.S. and Iran, the nations have established a 60-day negotiation period with the objective of reaching a final settlement, the report stated. And it added that the U.S. will begin lifting its maritime blockade outside the Strait of Hormuz and restore shipping access, with Iran restoring commercial navigation through the Strait of Hormuz and related waterways.
A copy of the text of the MoU posted on social media sites explained that immediately upon the signing of the MoU, the U.S., “will begin the removal of its naval blockade and any disturbances or impediments against the Islamic Republic of Iran, and will fully end the naval blockade within 30 days,” adding that, “During this period, the traffic of vessels will be in proportion to the numbers of pre-war traffic being restored by the Islamic Republic of Iran. The United States of America further undertakes to remove its forces from the proximity of the Islamic Republic of Iran within 30 days after the final Deal.”
The text also stated that Iran will make arrangements for the safe passage of commercial vessels, with no charge for 60 days, from the Persian Gulf to the Sea of Oman and vice-versa.
Port of Los Angeles Executive Director Cautions on Timeline
In a media briefing earlier this week, Gene Seroka, Port of Los Angeles Executive Director, said that with the Strait of Hormuz reopening oil and gas prices could continue to decline, coupled with the possibility that inflation could ease in the coming weeks and months. He also noted that shipping confidence could begin to return as well—with the caveat that shipping lines haven’t indicated that they’ll move quickly.
“Crew safety remains the priority for the 20,000 seafarers that remain on ships in the Arabian Gulf,” said Gene Seroka. “This is a situation where you definitely don’t want to be first in line, and even with a possible reopening, it will take months to normalize schedules, get supply chain back to some semblance of normalcy and clear backlogs.”
Maritime and Air Cargo Rate Impacts Forecast
Addressing how the MoU can bolster shipping efficiency, Paul Bingham, Director, Transportation Consulting, at S&P Global Market Intelligence, told LM that if the ceasefire holds and the threats to shipping not only in the Strait of Hormuz but in the Red Sea are removed, vessels may reroute into the Suez Canal route for trades that today take the much longer Cape of Good Hope route.
“The shorter sailing distances will help free up vessel fleet capacity, putting downward pressure, separate from fuel cost reductions, on maritime shipping rates,” he said. “Similarly, if the ceasefire holds and there are no more threats to air cargo operations in the Middle East, additional air cargo system capacity may be restored closer to pre-war levels, that should also result in lower air cargo rates internationally.”
Economic Ripple Effects Across Sectors
And he also noted that lower fuel prices will help return U.S. consumer prices to a downward path, perhaps avoiding U.S. Federal Reserve Board interest rate increases that were becoming a concern recently with the spike in U.S. price inflation in the last few months.
“Lower fuel prices can also enable consumers to spend more of their income on goods and services besides fuel purchases, helping boost demand for other goods in the economy,” he said. “The US economy will benefit from increased non-fuel spending as well as from perhaps greater corporate investment as lower interest rates help lower the cost of capital for firms recently facing higher interest rates.”
Supply chain impacts will vary by sector and geography, as more energy-intensive sectors benefit disproportionately from a reduction in fuel costs. There are also sectors such as agriculture who benefit from a return to operation of the Strait of Hormuz, due to not only petroleum commodity market but fertilizers, another big volume global export of the Persian Gulf that had been disrupted by the closure of the Strait of Hormuz. For some farmers it will come too late as planting season and peak fertilizer prices are already past for this 2026 crop year, but for others globally, reduced fertilizer prices will help in addition to the reductions in fuel prices.
Source: Logistics Management
Compiled from international media by the SCI.AI editorial team.
