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Airfreight Rates Soar Amid Capacity Constraints And Rising Fuel Costs

International airfreight rates increased across multiple routes, with some lanes rising by up to 95%, according to Drewry. The increase reflects reduced cargo capacity and higher fuel costs linked to geopolitical developments in the Middle East.

Reduced Capacity And Fuel Price Pressures

Data from Drewry Airfreight Insight show that rates from Shanghai to Dubai rose 95% to $8.60 per kilogram since the start of the conflict. Analysts said continued increases in fuel surcharges could push prices above the previous peak of $9.40 per kilogram recorded during the pandemic. Other routes also show higher costs. Fuel surcharges on shipments from Singapore to London increased by up to 290% month on month, while security surcharges from Dubai and Abu Dhabi to Amsterdam rose 44%.

Escalating Costs On Global Trade Lanes

Rate increases extend beyond individual routes. Shipments from Mumbai and Delhi to Madrid recorded an average increase of 27% over the past month, with fuel surcharges rising 21%. According to Philip Damas, reduced capacity and higher fuel costs are driving price increases across the airfreight market.

Impact On Major Airline Operations

Airline operations in the region have been affected by the conflict. Carriers including Qatar Airways, Emirates, and Etihad Airways reported reduced flight activity, limiting available cargo capacity. Nearly half of the routes monitored by Drewry recorded month-on-month price increases of 20% or more in March 2026.

Wider Market Implications And Strategic Responses

Middle East routes account for 15.6% of global airfreight traffic and 18.2% of capacity. Disruptions in the region are affecting global trade lanes, increasing transport costs for shippers.

Leveraging Data For Resilient Supply Chains

Drewry said access to rate data and surcharge trends helps companies plan logistics costs and adjust supply chain strategies. Benchmarking tools are used to track pricing changes and support freight planning decisions.

Cyprus Services Sector Shows Robust Performance In 2025 As Tourism, Digital Innovation, And Shipping Surge

The Employers and Industrialists Federation (OEV) reported growth across Cyprus’ services sector in 2025, with increases recorded in tourism, professional services and administrative activities. Data show continued expansion across multiple sub-sectors, reinforcing the role of services in economic output and employment.

Service Sector Leadership

Accommodation and food services grew by 9.5%, while administrative and support activities increased by 7.4%. Professional, scientific and technical activities rose by 4.6%, followed by information and communication at 4.3%. Transport and storage recorded growth of 2.8%, while real estate activity increased by 0.4%. These figures indicate broad-based expansion across service industries.

A Remarkable Tourism Surge

Tourist arrivals reached 4,534,073 in 2025, marking a 12.2% increase year-on-year. December arrivals totaled 156,959, up 18% compared with the same period a year earlier. Tourism continues to support revenue generation and seasonal demand across the economy. Growth in visitor numbers contributes to activity in hospitality and related sectors.

Driving Digital Transformation

OEV is supporting digital adoption through initiatives such as the DiGiNN Cyprus Digital Innovation Hub. The program focuses on improving business processes, skills development and technology integration. Additional efforts include the establishment of a Digital Transformation and Innovation Committee and international engagement through business missions. These actions support the adoption of digital tools across sectors.

Resilient Shipping Sector

Shipping accounted for about 7% of Cyprus’s GDP in 2025, remaining a key component of the economy. The Cyprus Registry recorded its highest tonnage in 20 years, with an increase of nearly 20%. Fleet growth strengthens Cyprus’ position within European Union shipping registries and global maritime markets. The sector continues to contribute to economic stability.

Strengthening The Economic Foundation

OEV is organizing conferences, workshops and exhibitions to support business development across sectors. These initiatives focus on improving operational practices and industry collaboration. Continued investment in services and digital infrastructure is expected to support economic performance.

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