Air cargo markets experienced sharp volatility in March 2026 as the escalating conflict between the United States, Israel, and Iran disrupted global supply chains, driving up rates while unevenly impacting demand.
According to WorldACD weekly data, the immediate effect of the war was a sudden contraction in available capacity. Airspace closures across the Middle East and the temporary shutdown of major hubs forced airlines to cancel or reroute flights, removing significant lift from the market.
In the first full week of March, global air cargo volumes fell 4% week-on-week and were down 12% year-on-year, with Middle East-origin traffic dropping as much as 36%.
At the same time, rates surged. Reports show global air freight prices rising between 6% and 10% week-on-week through March, as capacity shortages combined with longer flight routings and higher fuel costs.
Spot rates climbed particularly sharply on Asia–Europe lanes, where disrupted Gulf transit routes play a critical role. Broader estimates suggest some corridors saw price increases of up to 45% following the onset of the conflict.
The war also drove structural shifts in demand. While overall volumes initially declined due to operational chaos, demand for air cargo strengthened in specific segments.
Disruptions to maritime shipping, especially through the Strait of Hormuz, triggered a partial modal shift from sea to air for time-sensitive goods. This helped stabilize global demand levels despite regional declines.
IATA, reporting on pre-war February data, had already highlighted strong year-on-year demand growth of over 11%, but warned that rising fuel costs, constrained capacity, and Gulf hub disruptions would weigh heavily on the outlook.
These concerns materialized quickly in March, as jet fuel prices surged and war risk premiums increased operating costs.
Overall, March 2026 marked a turning point for air cargo markets. Rates rose sharply under supply pressure, while demand became more fragmented, reflecting both disruption and adaptation in global trade flows.
Read More: