Air freight rates rise again with the Ukraine invasion by Russia, but that’s to be expected. As the air freight market becomes increasingly paralyzed and expensive, more air lines are suspending flights, but not just to Russia; Korea, China, and Japan are also being affected by the suspensions.
Kazakhstan of all places has seen three times more flights than usual. Asian carriers can and do continue to fly in Russian airspace, meanwhile European carriers are adding detours, time, and costs to flight operations just to avoid Russian airspace. While the US is considering a ban on Russian airlines, it seems wary of its own carriers losing access to Russian airspace; a White House spokesperson noting there were a “range of factors” to consider.
Meanwhile, limited air capacity is presenting a double whammy for shippers. Between airspace being closed over Ukraine to civilian flights, to airlines avoiding Russian airspace, there’s no end in sight to the spiking air freight rates.
“The flying ban has canceled many of these flights and removed 10 million miles of airspace from international freight routes,” Alperin said. “With airlines responsible for flying around 20% of cargo, this will dramatically decrease capacity provided by carriers.”
The growing number of carriers that have suspended services in Russia, make up about 62% of total ocean freight capacity, meanwhile tanker rates have skyrocketed with a spike from 157% to 591%, Alperin also stated.
Because air freights are avoiding Russian airspace, airlines will have to take alternate, longer routes, raising fuel costs. Rising and surging to record levels, oil prices have continued to rise alone with them.
With this war, gas, and oil price rising crisis, we here at Nelson want to keep you informed of what is going on and why. We will continue to stay updated on this situation and bring it to your attention as things change. Should you have any questions, please do not hesitate to contact your Nelson representative today.