The global squeeze on freight shipping is raising costs across supply chains, as U.S. trucking rates rise because capacity has left the market. 

In Bahrain, home to the U.S. Fifth Fleet, several hotel bars had run out of draft beer in early October, and bottled beer was in short supply. Bartenders and hotel staff in Manama blamed the war and its disruption of shipping through the Strait of Hormuz.

The cost of insuring vessels through the Strait of Hormuz  has skyrocketed since the war began in late February. A chokepoint the width of Manhattan is rippling through global supply chains.

Hull war-risk premiums peaked at as much as 10% of a vessel’s insured value, up from about 0.25% before the fighting, according to insurance broker Marsh.

Current market estimates put premiums at roughly 3% to 8% of hull value. In July, Marsh cited quotes of 7.5% to 10% amid renewed attacks.

Glove Maker Strain 

Malaysian glove makers also faced soaring costs and shortages of petroleum-based raw materials, including nitrile latex, butadiene and acrylonitrile. 

One manufacturer, WRP Asia Pacific, said it would wind down operations, while Top Glove raised prices as input costs climbed, according to Financial News. 

In the U.S., a supply squeeze is pushing truckload rates higher, and war-driven diesel prices are adding to the pressure. 

U.S. truckload contract rates climbed to a 52-week high of $2.72 per mile, excluding fuel, according to FreightWaves SONAR data from Oct. 9. 

That marks an 18% increase from a year earlier.

Diesel Pressure Builds 

U.S. diesel prices averaged $6.20 a gallon in the week to Oct. 5, according to the Energy Information Administration. That is nearly $2.50 more than a year ago, though down from $6.53 two weeks earlier. 

The spike has added pressure on a U.S. trucking industry already shedding capacity. Spot rates on the National Truckload Index have surged nearly 50% year-over-year. 

Shippers are resetting agreements at higher levels as capacity constraints squeeze the market. 

The Outbound Tender Reject Index, which tracks how often carriers turn down contracted loads, stood at 13.75%, holding within a 13% to 14% band.

Rising rates lift transportation costs for shippers, retailers and manufacturers. Those costs can either be passed on to consumers through higher prices or absorbed at the expense of corporate margins.

Capacity Constraints Tighten Market  

Notably, the tightening is being driven by limits on supply rather than a pickup in freight demand.

Federal enforcement against non-compliant drivers and carriers has removed some capacity, and the fuel spike has made things worse. 

In April, Knight-Swift Transportation Holdings Inc. (NYSE:KNX) CEO Adam Miller said rising fuel costs would add to the existing downward trend in truckload supply. 

Knight-Swift, North America’s largest full-truckload carrier, is widely viewed as the stock most leveraged to the freight cycle. 

In July, the company said supply-driven tightening had pushed spot rates, tender rejections and contract negotiations higher. 

Shares closed Friday at $64.47, up about 23% year-to-date, ahead of the company’s Oct. 21 earnings report.

J.B. Hunt Outlook

J.B. Hunt Transport Services Inc. (NASDAQ:JBHT) faces a more mixed picture. The Lowell, Arkansas-based company’s truckload and dedicated units gain directly from higher rates. 

Its intermodal business can also pick up freight when trucking capacity gets expensive. But the same forces lifting rates are also raising its costs, as diesel prices and driver hiring expenses climb.

"Capacity has tightened across the industry," Chief Executive Officer Shelley Simpson said in July. "While demand is improving gradually, the current market tightness is being driven primarily by supply conditions," she added. 

The stock is up about 18% year-to-date, but Wall Street has grown more cautious. 

Several analysts trimmed price targets this week ahead of the company’s October 15 earnings report. They cited valuation compression and rising driver and energy costs. 

Offshore Tanker Tightness 

The same supply squeeze is even more extreme offshore. 

The Breakwave Tanker Shipping ETF (NYSE:BWET), which tracks tanker freight futures, closed Thursday at $1,012.75, up from $19.26 at the end of 2025. That is a gain of 5,157%.

The surge is clearest in the market for very large crude carriers, or VLCCs, supertankers that each carry about 2 million barrels of oil. 

At the start of the year, a VLCC sailing from the Middle East to Asia earned around $30,000 a day, according to shipbroker Poten & Partners. In its Oct. 2 Tanker Opinion, the firm said that rate has since reached $1.3 million a day, 43 times the January level.

Rerouting Adds Massive Costs to Oil Transport 

Rerouting is tying up even more ships. 

"Forty percent now bypass Hormuz, and most crude crossing the strait changes tankers offshore," ship-tracking firm Kpler estimated.  

On a per-barrel basis, the cost of moving crude oil on that route has jumped from $1.73 to almost $33. 

Empty taps in Bahrain, rubber-glove supply pressures in Malaysia and record tanker rates all trace back to one narrow waterway. 

Even where governments and companies have found temporary workarounds, the war’s disruption to Hormuz has raised costs across supply chains—and until shipping normalizes, businesses and consumers will keep paying more.