Shipping Giant Maersk Maintains Guidance Despite Rising Costs From Middle East Conflict — Update

By Dominic Chopping

A.P. Moller-Maersk maintained its full-year guidance as demand for container shipping remains strong, but cautioned that the Middle East conflict will increase costs due to service disruptions and higher fuel prices.

The Danish shipping giant said the conflict weighed on demand growth in the region toward the end of the quarter, but the impact is yet to show up in its financials as it works to recover the higher costs through savings and by passing them on to customers.

The update is the company's first since the outbreak of the Middle East conflict at the end of February. Since then, shipping in the area has been crippled. Container-shipping operators have suspended services in and around the Strait of Hormuz and the Gulf of Oman, and are re-routing vessels to avoid the Red Sea and Suez Canal.

"After the recent tariffs on U.S. imports, the conflict represents another wake-up call to deploy new tools to make supply chains more resilient and develop new strategies to mitigate future disruptions," the company said.

The company's main shipping business swung to a first-quarter loss as higher volumes were offset by lower freight rates. The unit reported a loss before interest and taxes of $192 million from a profit of $743 million a year earlier.

With few to no vessels passing through the Strait of Hormuz, which is a key passage for global oil transport, the price of fuel has surged. However, Maersk said its first-quarter shipping fuel bill fell 15% on average as the company sheltered itself from the initial conflict-induced price spike by using existing inventory.

Average freight rates declined by 14% in the quarter due to industry overcapacity, despite a significant jump in rates toward the end of the quarter following the outbreak of war.

Demand for container trade further increased, with volumes rising 9.3%, driven by export growth out of China, while operating costs were stable as the company continues to work through a project that will see it cut around 1,000 corporate jobs this year as part of plans to save $180 million annually.

Global container-volume growth is still expected at between 2% and 4% this year, assuming oil prices remain in the $90-$100 a barrel range through 2026 and the conflict is resolved soon. The company expects to grow in line with the market.

Maersk's first-quarter revenue slipped to $12.97 billion from $13.32 billion a year earlier, while underlying earnings before interest, taxes, depreciation and amortization fell 33% to $1.83 billion and underlying EBIT fell 65% to $420 million.

All metrics landed above analyst forecasts taken from FactSet.

It still targets between $4.5 billion and $7 billion in underlying Ebitda and between minus $1.5 billion and positive $1 billion in underlying EBIT.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

May 07, 2026 03:58 ET (07:58 GMT)