Hormuz closure risks permanent transhipment loss at Jebel Ali and Khalifa
The Hormuz Strait closure, now approaching its eighth month, is predicted to cause a permanent loss of transhipment traffic at the UAE’s Jebel Ali and Khalifa ports. DP World is constructing 2.5 million TEU of capacity outside the Hormuz Strait to offset expected losses. Gulftainer plans to raise Khor Fakkan’s annual capacity from 3.5 million to 10 million TEU, positioning the port as a Gulf bypass.
Insurance premiums for vessels transiting the Hormuz Strait have risen from pre‑war levels of 0.1‑0.2% of hull value to between 2.5% and 7.5%. In July, DP World secured a 50‑year concession with Fujairah Port Authority to build two terminals outside the strait. Carriers such as MSC, CMA CGM and Maersk have already shifted calls to alternatives like Khor Fakkan, Sohar, Salalah, Colombo, Vizhinjam and Jeddah.
“Relay transhipment doesn’t come back – ever,” Eirik Hooper, Drewry’s senior associate for ports and terminals said.
“Insurers will not restore pre-2026 pricing for a strait that’s been mined and blockaded, and a hub whose access carries a persistent risk premium and cannot win price-sensitive relay cargo against a Salalah or Colombo – that’s structural, not cyclical,” Eirik Hooper, Drewry’s senior associate for ports and terminals said.
Prior to the outbreak of the US-Israel-Iran conflict, the two UAE ports were a favoured waypoint for relay transhipment operations – boxes moving between Asia-Europe vessels and ships deployed on north-south trades. Both DP World and AD Ports reported huge declines in first half volumes at Jebel Ali and Khalifa respectively, due the war, forcing their owners to look elsewhere for growth.
What we know
The Hormuz Strait closure is approaching its eighth month.
DP World is building 2.5 million TEU of capacity outside the Hormuz Strait.
Gulftainer plans to increase Khor Fakkan’s annual capacity from 3.5 million to 10 million TEU.
Insurance premiums for vessels transiting the Hormuz Strait have risen to between 2.5% and 7.5% of hull value.
DP World secured a 50‑year concession with Fujairah Port Authority in July to build two terminals outside Hormuz.