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US blockade of Iran's maritime transportation: Large equipment such as rotary drilling rigs are under comprehensive pressure in shipping and logistics

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The United States announced the blockade of Iran's maritime transportation, coupled with the suspension of shipping in the Strait of Hormuz, causing severe turbulence in the global energy and logistics system. As the core equipment of global engineering construction, cross-border transportation of large equipment such as rotary drilling rigs and pile drivers is facing multiple impacts in terms of timeliness, cost, safety, and supply chain. Export enterprises and logistics providers are facing unprecedented operational difficulties.

The waterway is completely blocked, and the shipping routes for large equipment are completely interrupted

The Strait of Hormuz, as a global shipping hub, carries over a hundred merchant ships daily and undertakes nearly one-third of the global transportation of crude oil and a large amount of engineering equipment. After the US military implemented a blockade, the main channel of the strait was completely cleared, and all ships entering and leaving Iranian ports were intercepted. The Persian Gulf to Asia Pacific and European routes were completely interrupted. Oversized and overloaded equipment such as rotary drilling rigs and pile drivers rely on large general cargo ships and heavy lift ships for transportation. These types of ships have extremely low flexibility and cannot quickly adjust their routes like container ships. The equipment required for infrastructure projects in the Middle East and South Asia has been forced to cancel the direct shipping route through the strait, and ships in transit have been stranded in the waters outside the Gulf of Oman and the Persian Gulf. The equipment that has already been booked cannot be shipped, and a large number of export orders are facing the risk of delay and default.

Forced to detour around Cape of Good Hope, transportation efficiency and costs have significantly increased

To avoid the risk of blockade, shipping companies were forced to abandon the Strait of Hormuz and divert to the Cape of Good Hope in Africa. This adjustment has increased the voyage distance of the Asia Europe and Asia Middle East routes by over 7000 kilometers, extended transportation time by 10 to 15 days, and significantly reduced ship turnover efficiency. For large equipment such as rotary drilling rigs, the extended transportation cycle directly delays the start of overseas pile foundation projects, and some projects are suspended due to the equipment not arriving. At the same time, fuel costs have risen sharply with oil prices, with war and cargo insurance rates soaring by 300% to 500%, and the cost of transporting a single large rotary drilling rig across the ocean increasing by over 40%. Shipping companies are imposing emergency risk surcharges, while port demurrage and transit fees are rising simultaneously, significantly reducing the profit margins of equipment export companies.

Port resource squeeze, sharp drop in efficiency of large equipment transfer and loading and unloading

The blockade has triggered a redistribution of global port resources and disrupted the functionality of hub ports in the Middle East. Traditional large equipment transfer ports such as Dubai's Jebel Ali and Abu Dhabi's Khalifa have experienced a more than 50% decrease in loading and unloading efficiency due to route disruptions and vessel congestion. Alternative ports such as Fujairah and Suhar in Oman have limited throughput capacity, a shortage of specialized lifting and tying equipment for large equipment, and significantly extended transit and unloading cycles for ultra wide and ultra high equipment such as rotary drilling rigs. Some ports prioritize the transportation of energy materials, and the priority of large-scale civilian equipment has been lowered. The processes of equipment shipment, customs clearance, and delivery have been hindered, further exacerbating logistics chain delays.

Security risks surge, equipment transportation and asset protection face challenges

The Strait of Hormuz and its surrounding waters are listed as the highest risk zone, with frequent military confrontations, mine laying, navigation interference, and no guarantee for the safety of ship passage. High end equipment worth tens of millions, such as rotary drilling rigs, face multiple risks during transportation, including collisions, attacks, and water ingress. Once damaged, the repair cost is extremely high and the cycle is extremely long. Most insurance institutions refuse to underwrite transportation business in the region, and companies need to bear full risk or pay sky high premiums to obtain limited protection. At the same time, the uncertainty of the regional situation has led to frequent changes in shipping schedules, repeated adjustments in equipment transportation plans, making it difficult for enterprises to accurately control delivery cycles, and a decline in trust and cooperation willingness among overseas customers.


Supply chain disorder, equipment export and project performance are in trouble


Global shipping capacity is tight and cabin space is scarce, making it difficult to find specialized heavy lift vessels for large equipment. Rent has skyrocketed to more than five times that of regular days. The production, cargo collection, and loading cycles of rotary drilling rigs and other equipment have been disrupted, resulting in disruptions in raw material supply and accessory transportation, and a decrease in overall delivery capacity. Infrastructure projects in the Middle East, Europe, Southeast Asia, and other regions that rely on Chinese engineering equipment are facing work stoppages and delays due to logistics disruptions, and some project contracts are facing claims for non performance. Enterprises are forced to adjust their market strategies, temporarily suspend orders from high-risk areas, and turn to inland transportation or multimodal transportation. However, the limited capacity of railways and highways makes it difficult to meet the demand for large-scale equipment transportation.

Diversified response strategies to solve logistics difficulties under geopolitical conflicts

Faced with severe challenges, engineering equipment enterprises and logistics providers need to collaborate and proactively respond. Closely monitor the situation and shipping dynamics between the United States and Iran, lock in cabin space in advance, assess risks, optimize transportation routes, and reduce dependence on the Strait of Hormuz. The "sea+land" multimodal transport is adopted, which is transited through the ports of Türkiye, Oman and other third countries, and then delivered to the destination through cross-border land transport. Strengthen cooperation with professional large-scale logistics enterprises, optimize equipment packaging and bundling schemes, and improve transit efficiency. Communicate openly with customers, negotiate and adjust delivery cycles and contract terms to reduce default risks. At the same time, establish a diversified supply chain system, expand alternative transportation channels, enhance risk resistance capabilities, and minimize the impact of geopolitical conflicts on large-scale equipment shipping logistics.

Anhui Yingxie Foundation Engineering Co., Ltd. is a leading exporter of construction machinery in China.

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