Shipping companies told to avoid gouging

The Directorate General of Shipping (DGS) has urged shipping companies, vessel operators, and agents to avoid predatory and non-transparent pricing practices following disruptions caused by the ongoing conflict in West Asia.

In an advisory issued on Monday, the regulator emphasized that all applicable charges must be communicated clearly and upfront to exporters, importers, and other stakeholders. The move comes after complaints from EXIM trade participants about multiple ancillary charges imposed by shipping lines and their agents, which were perceived as opportunistic and non-transparent, escalating logistics costs.

The DGS noted that some operators may be taking undue advantage of the current geopolitical tensions, including the war-like situation in the Middle East. The advisory called for adherence to fair trade practices, discouraging the imposition of excessive charges that could lead to disputes within the EXIM sector.

Freight rates have surged in recent days as military tensions escalate among Iran, the United States, and Israel. A shipping executive explained that the conflict is forcing vessels to take longer routes, including around Africa, increasing fuel consumption and operational costs.

Analysts at BigMint Research highlighted that crude oil prices, which averaged around USD 70 per barrel before the conflict, have climbed to nearly USD 90 per barrel, further adding pressure on shipping costs.

The DGS stressed that transparency, fairness, and predictability in the logistics ecosystem are essential to maintain stability in the EXIM trade. Companies have been asked to ensure all charges are justified, clearly communicated, and not exploitative, especially during this period of heightened geopolitical uncertainty.

The advisory aims to protect exporters and importers from sudden and excessive cost hikes while encouraging responsible practices among shipping operators amid rising global energy prices and logistical challenges.