Supply chain disruptions drive rising costs and delays across the Gulf

Business Tech 15-04-2026 | 13:43

Supply chain disruptions drive rising costs and delays across the Gulf

Rerouted shipping routes, port congestion, and Strait of Hormuz disruptions are forcing governments and businesses to adopt emergency logistics measures, but prices are still climbing and delivery times are stretching across the region.

Annahar

Supply chain disruptions drive rising costs and delays across the Gulf

Cargo ships in the Arabian Gulf

Before the outbreak of the war on Iran, the arrival of shipments of Austrian spruce wood in Qatar was routine. This wood is used to support concrete and to build basic structural frameworks at construction sites.

The standard 2x4 timber, as it is known in the construction industry, was usually imported from Austria in Europe and shipped to Jebel Ali Port in Dubai, then transferred onto another vessel and delivered to Hamad Port in Qatar in about 45 days, according to Reuters.

Now, however, the cargo must be unloaded and transported by road using trucks and then reloaded onto new ships, which adds thousands of dollars in costs and delays delivery schedules by months. This is due to the effective closure of the Strait of Hormuz, which has caused unprecedented disruption in oil trade and other goods.

White wood beams reflect a broader disruption

Everything from medicines to basic food supplies and 2x4 spruce wood beams, known as white wood, is stuck because of these disruptions.

White wood beams are not considered a strategic resource, but any shortage of them can slow down construction activity and increase costs.

A construction materials supplier in Qatar, who spoke to Reuters on condition of anonymity, said that when the United States and Israel carried out air strikes on Iran on 28 February, triggering a new phase of conflict in the Middle East, he had 17 containers of white wood on their way to him.

The shipment left the Croatian port of Rijeka as planned, but instead of sailing to Jebel Ali, it was diverted to Khor Fakkan on the eastern coast of the United Arab Emirates in order to avoid crossing the Strait of Hormuz, which would have been necessary to reach Jebel Ali.

Even after the change in route, the shipment has still not reached Qatar and is expected to take one or two more months to be delivered.

At the same time, several containers of plywood ordered by the supplier were loaded onto ships in Jebel Ali and remained at sea for weeks before returning to the port, highlighting how importers lose control over shipments once they enter maritime waters.

Rising costs of essential goods

Before the conflict, the supplier said he was selling a standard 2x4 piece of wood for about 23 to 25 Qatari riyals (6.30 to 6.90 US dollars) per piece. The additional costs caused by rerouting shipments and longer transport times pushed the selling price up to 35 to 37 Qatari riyals (9.60 to 10.20 US dollars) per piece.

Future shipments could be even more expensive. Routing timber through the port of Jeddah on the Red Sea in Saudi Arabia, an option currently being considered, would require higher shipping fees and trucking the goods about 1500 kilometers across the Arabian Peninsula to Qatar. This would further increase the cost per piece, and other supply chains are experiencing similar disruptions.

Before the outbreak of the Iran war, the logistics company Geodis planned to transport medicines by air from the United Kingdom to Dubai in about four days. Now, the journey is expected to take around 40 days when routed by land and sea.

For a container of onions moving from the western coast of India to a warehouse in Dubai, a trip that used to take one week now takes three weeks at double the cost, according to Ravi Punjabi, managing director of Avalon General Land Transport, a logistics company based in the UAE.

Some countries are more affected than others

Dubai and the United Arab Emirates in general, which have built their economies on being a regional hub for tourism and trade, benefit from ports such as Fujairah and Khor Fakkan on the Arabian Sea outside the Gulf.

For other countries in the region, the situation is much worse, especially Qatar, Bahrain, and Kuwait, which depend on the Gulf and the Strait of Hormuz.

Governments across the Gulf have expanded coordination efforts to ease bottlenecks.

During a meeting with his counterparts last month, Saudi Transport Minister Saleh bin Nasser Al-Jasser announced measures including allowing empty refrigerated trucks coming from other Gulf countries to enter Saudi Arabia, and establishing shared storage and redistribution zones at King Abdulaziz Port in Dammam.

Dubai has also activated what it described as a green corridor with Oman, allowing goods redirected to Omani ports to be transported directly to the UAE by truck, while speeding up customs clearance procedures and facilitating the export of goods from the UAE to global markets through Omani ports.

However, these solutions are not sufficient, and transport officials say that flows into Dubai and onward to other Gulf capitals are likely to remain slower and more expensive.

Prices of food products, personal care items, and industrial supplies have already risen by between five and ten percent across parts of the region since the end of February, with further increases possible if shipping disruptions continue.

Supply chain disruptions drive rising costs and delays across the Gulf

Supply chain disruptions drive rising costs and delays across the Gulf

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