How Shipping Freight May Be Affected By Ukraine War

While war may have its most obvious casualties on the battlefield and in exposed civilian areas, the economic and freight logistic consequences of the Russian invasion of Ukraine will not just be felt by Russia itself.

A primary shipping consequence of the war has been to impact trade in the Black Sea, most obviously in Ukrainian ports like Odesa and Mariupol, which have become no-go zones for civilian shipping as the battles rage around them. One Estonian cargo ship, the Helt, has been sunk while anchored between Russian and Ukrainian forces at Odesa.

However, the worldwide freight sector will also be affected in various ways by the stern economic sanctions placed on Russia, which will have a major impact on global trade.

An obvious first consequence will be sanctions – and not just those imposed by governments or the EU. Several of the world’s largest shipping lines have now suspended shipping to and from Russia. These include MSC, Maersk, Ocean Network Express and Hapag Lloyd.

All this will be ruinous for Russian firms hoping to export or import goods, while Russian ports will fall quiet, from Vladimir Putin’s home city of St Petersburg in the Baltic to the east coast ports of Vladivostok and Vostochny.

The implications of this are more widespread than may be imagined. Globally, even countries as far off as Australia will be affected.

As Channel News reports, Australia has followed countries like the UK in banning all Russian ships from its ports, while there are concerns that a higher concentration of freight movement through other European ports could congest the flow of goods out of the continent and thus slow down their arrival down under.

Another implication may be that European ports will be receiving more ships from the US and elsewhere importing LPG, especially if Mr Putin decides to cut supplies of oil and gas. This issue may be less acute when European homes don’t need heating in the summer, but could return with a vengeance in the autumn if the Ukraine conflict descends into a protracted war of attrition.