Global trade routes, particularly vital maritime chokepoints like the Strait of Hormuz and the Red Sea, are increasingly becoming battlegrounds due to a new era of drone and missile warfare. This rising instability is disrupting commercial shipping, driving up costs for insurance and freight, and forcing companies to rethink supply chain strategies. Experts warn that even traditionally safe passages like the Panama Canal could become future flashpoints, impacting everything from energy and food prices to consumer goods worldwide.
The Strait of Hormuz is at the heart of global trade concerns, yet it represents just one of many crucial maritime corridors now evolving into frontlines in a modern age of warfare. Drones and missiles are increasingly being deployed to target economic lifelines, ushering in a new era of maritime conflict.
From the Persian Gulf's Strait of Hormuz to the Red Sea and the Black Sea, commercial vessels have endured a wave of attacks. These incidents have not only disrupted established trade routes but also escalated insurance and freight costs, compelling shipping companies to re-evaluate what were once considered reliable passages.
The stakes are profoundly high: approximately 80% of the world’s merchandise trade by volume relies on sea transport. A disruption to even a single major route can trigger cargo delays, tighten global supplies, and drive up prices for essential goods like energy, food, and consumer products thousands of miles away.
The Drone Revolution in Maritime Warfare
“We have a new chokepoint and a new war,” stated David Roche, president and global strategist at Quantum Strategy, in a July report. He highlighted the Sea of Azov and the Black Sea, where Ukrainian drones have been targeting Russian tankers.
Roche characterizes this conflict as the first maritime offensive largely conducted through drones, supplemented by missiles. Such advanced yet affordable weaponry provides smaller military forces with potent means to threaten ships, ports, and critical infrastructure, whose disruption carries immense economic repercussions.
Quantum estimates that a significant portion—around 25% of Russia’s grain exports and 25% to 30% of its Black Sea oil exports—could be jeopardized. Given Russia’s role in growing over a fifth of internationally traded wheat, the potential impact on global food prices is substantial.
Yevgeniya Gaber, a senior fellow at the Atlantic Council think tank, noted that Russia’s recent suspension of shipping through the Kerch Strait, linking the Sea of Azov and the Black Sea, has effectively sealed off a vital maritime passage.
“Maritime transport through the Sea of Azov had become an increasingly important alternative to the land corridor connecting Russia with occupied Crimea,” Gaber explained via email. She emphasized the equally significant economic implications, as the Sea of Azov has facilitated the transport of sanctioned crude oil, petroleum products, grain, coal, and steel.
Gaber asserts that Ukraine’s strategic efforts to exploit Russia’s maritime and economic vulnerabilities constitute “one of the most significant blows to military and commercial fleets” since World War II. Indeed, Ukraine claims to have degraded roughly one-third of Russia's Black Sea fleet since 2022.
Is the Panama Canal the Next Flashpoint?
In the Strait of Hormuz, commercial operators navigate a volatile environment marked by attacks and rapidly changing assessments of safety. While governments may declare a waterway open, shipowners ultimately decide based on the probability of a vessel being struck and crew members being harmed or killed.
“We often treat the Strait of Hormuz, the Black Sea, or Bab el-Mandeb as isolated events. They are not,” cautioned Daejin Lee, global head of research at Fertistream Freight.
Lee elaborated to CNBC via email, stating that “These waterways are increasingly becoming battlegrounds within the broader transition toward a new world order.”
And new threats are constantly emerging. “If you’re talking about the next flashpoint, I wouldn’t look at the Strait of Hormuz,” suggested Lars Jensen, chief executive officer of Vespucci Maritime. “I would look at the Panama Canal.”
This strategic canal, a shortcut connecting the Pacific and North Atlantic for over a century, is already embroiled in a geopolitical tussle involving the U.S., China, and Panama over influence. Jensen added that potential weather-related restrictions later this year and early next could exacerbate these tensions by reducing transit capacity.
Shipping Impact: “Bigger Than Most Realize”
For shipping companies, the overarching challenge is to prepare for a world where new chokepoints emerge before previous ones have reopened.
Kevin O'Marah, co-founder and chief research officer at supply chain intelligence firm Zero100, noted that the Strait of Hormuz became critical in the U.S.-Iran dynamic once Iran realized that merely threatening traffic there was enough to halt it.
While none of Zero100’s clients had directly faced attacks in the strait, O’Marah stated that some opted to mitigate risk by proactively managing inventories and rerouting shipments.
“It has added cost and delay for some of our clients in the energy, food, and electronics industries,” he confirmed. “As of now, traffic through the Strait looks to be running at about half the normal flow. The recent breakdown in the ceasefire has definitely hurt the situation but no one is surprised. Supply chain leaders, and in particular logistics specialists like Martin Brower and Maersk, are aware and have well established protocols for dealing with the risk.”
Mitigation strategies include rerouting oil across the Arabian Peninsula via pipelines, moving certain commodities overland into Turkey, and avoiding the affected areas whenever feasible, O’Marah elaborated.
The conflict in the Middle East, while not perceived as an escalating conflict by most supply chain leaders, is expected to be a “long-term problem in terms of freedom of movement through the Strait of Hormuz,” he added. “We are planning on a steady state of transportation uncertainty and costs associated with reroutings, inventory buffering, and shipping surcharges.”
Alain Bejjani, a Dubai-based investor, business executive, and judge on “Shark Tank Lebanon,” told CNBC that shipping lanes would remain central to the conflict because “they are the conflict.”
“The war has migrated from territory to logistics. A strait does not close when missiles fly; it closes when insurers stop writing cover,” he explained. “That makes disruption cheap to sustain and hard to price, which is exactly why it persists.”
A spokesperson for insurance broker Gallagher confirmed that war risk insurance, an add-on covering financial losses from war, terrorism, and civil unrest, is still available. However, they noted that “a handful but not many” shipowners or charterers are choosing to navigate the Strait of Hormuz.
“Given the challenging maritime security environment, rates have increased from levels that owners and charterers will be used to. The cost will vary depending on the vessel type, cargo and routing, however marine insurers are continuing to provide cover and helping to ensure marine commerce can continue with adequate coverage in place,” the spokesperson added.
How Companies Are Adapting to Shipping Risks
Bejjani emphasized to CNBC that the structural ramifications of maritime warfare are “bigger than most people realize.”
“The Gulf is bracketed by two straits, not one, and the region is now designing around both Hormuz and Bab el-Mandeb to the maximum extent possible,” he said.
“That is new. Past crises produced hedges. This one is producing an architecture: overland corridors, bypass pipelines, forward storage near the markets that matter most. It will cost heavily, take a decade, and ripple for decades more. I expect other strait-dependent regions to follow, though few with the same urgency or resources.”
He cautioned that while shipping will likely maintain its dominance in terms of volume, it is poised to “lose its monopoly on trust” within the business world.
“Other modes of transport will be substantially enhanced where certainty matters most, and redundancy becomes a permanent, priced feature of logistics,” he concluded. “The strait will reopen. The assumption that it stays open for free will not return.”
