Air freight prices are rising sharply, by as much as 82% on some routes, according to figures from Israeli company Freightos (Nasdaq: CRGO), which monitors air and sea shipping prices. The rise is attributed to the rising cost of jet fuel and to the partial closure of the major airports of Dubai and Doha. The price rises are mainly affecting shipments of drugs from India, electrical and electronic products, and the fashion and clothing industry.
Iran’s closure of the Straits of Hormuz, through which 20% of the world’s oil supplies pass in normal times, has caused the price of oil to jump. Consequently, the price of jet fuel has risen by 83% within a month, and by 94% in comparison with last year, according to reports by IATA (the International Air Transport Association).
In addition, the global air freight industry is under operational pressures. In recent years, the Gulf states have established themselves as a hub for flights and trade between Europe and Asia, particularly Dubai in the UAE and Doha in Qatar. Iranian UAVs have hit Dubai Airport, leading the Australian government to issue a warning against travel to Dubai, including for connecting flights. Hamad International Airport in Doha is also operating on a restricted schedule.
The combination of these factors has led to a steep rise in air freight prices on all routes. On some the situation is very severe: flights from South Asia to Europe that fly directly above the Persian Gulf have become 82% more costly than before the war, and flights from South Asia to North America have also risen in price, to $6.42 per kilogram, which compares with $4.05 per kilogram before the war. Prices on the air route from Europe to the Middle East have also risen lately, by 55%. All the figures are from Freightos.
Hit to pharmaceutical industry
According to Freightos head of research Judah Levine many air freight routes have been affected by the closure of the air space over the Gulf, and tariffs have risen substantially. Qatar Airways and Emirates are two of the three airlines with the largest cargo capacity in the world, and together with Etihad they represent 13% of the world’s total air cargo capacity. He says that the hubs in the Gulf represent critical connection points between East and West. “They serve about a quarter of air freight between China and Europe, and a substantial slice of the cargo transported from South and South-East Asia to Europe and North America.”
Levine adds that the products most affected are “electronics and online trade from the Far East, and clothing and fast fashion, and adds: “From South Asia, in addition to clothing, the pharmaceuticals industry accounts for an important part of Indian exports to Europe.” Pharmaceuticals are a significant Achilles’ heel, since their high value in relation to their weight and the need to bring them swiftly and safely to their destinations creates great pressure on air freight services.
India’s pharmaceutical industry is important for the supply of cheap drugs, and Indian drug exports are worth over $30 billion annually. With the sudden rise in jet fuel prices and the shutdown of airports in the Gulf, the difficulty of transporting them to their destinations will increase.
Published by Globes, Israel business news – en.globes.co.il – on March 17, 2026.
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