Author Name: Emma Hau – Marketing Analyst at FreightAmigo | 11/3/2022
Russia’s invasion of Ukraine forced the United States, United Kingdom, European Union banning the imports of Russian oil. Oil prices hit $130 a barrel after the news, highest since 2008.
Russia is the world’s third-largest oil producer and the largest exporter of crude to global markets. Barclays warned the prices in its worst-case scenario oil could top $200 a barrel while Goldman raised its 2022 Brent spot price forecast to $135 per barrel.
High oil prices result in higher air cargo costs. After China Airline and Eva Air, AirAsia Malaysia and Korean Air Cargo also announced a rise in fuel surcharge due to escalating fuel prices. Courier delivery service companies such as FedEx and UPS also propose additional peak surcharge for their international services recently.
With the ongoing Russia-Ukraine conflict, oil price will be uncertain. The cost of transporting goods by air will therefore continue to surge.
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