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Strait of Hormuz Shipping Essential, Not Trucks

Financial Times Companies •
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Land routes cannot replace shipping through the Strait of Hormuz for Gulf trade due to prohibitive costs and delays, according to Stefan Paul, chief executive of Kuehne+Nagel, the world's largest freight forwarder. His comments address ongoing concerns about potential future closures of the vital waterway by Iran.

Paul stated that trucking solutions are unsustainable long-term, citing a significant shortage of trucks compared to the mass of goods carried by container ships. Road transport surged after late February attacks on Iran led to the strait's closure, causing congestion outside the Gulf and straining land routes stretching to Turkey and Jordan. Lorry hire costs have risen by approximately 25%, nearing $8,000 per month, and border crossings have experienced extensive queues.

While some logistics providers like CMA-CGM are investing in new facilities, such as a $400 million project in Oman's Sohar port, Paul believes these land bridges will become less necessary once the strait reopens. Experts suggest that while shipping routes may not revert entirely to pre-conflict patterns, the inherent cost-efficiency of maritime transport will likely lead operators back to their original networks, with Saudi Arabia's planned railroad potentially supplementing rather than replacing sea lanes.