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Each year the Micromobility America conference meets in California to showcase the latest companies and advancements in the light electric vehicle world. The sister show to Micromobility Europe, this year’s North American conference moved to Southern California, bringing to Costa Mesa an array of just about every type of micromobility device you could imagine, from e-bikes, e-scooters and fully-fledged electric motorcycles to four-wheeled neighborhood electric vehicles.

While it’s hard to cover every single company from the show, we did our best to pull out as many highlights as possible. See them below, or watch the video for an up close and personal experience. Or both!

Lectric Ebikes

Lectric Ebikes, which has grown in just five years to the best-selling electric bike brand in the US, had a prime spot at the show to share the company’s ever-growing lineup. At the center of the booth was the new Lectric XPedition 2.0 electric cargo bike, which was recently unveiled as a major update to the brand’s first cargo e-bike.

The XPedition somehow retained the same $1,399 selling price, while coming with lots of new features like an upgraded frame, improved suspension fork, torque sensor, better brakes, color display, larger battery options, and plenty of other new features.

The company’s CEO, Levi Conlow, was also one of the most popular speakers at the event, sharing his insights with the standing-room-only audience.

VMAX Electric Scooters

The Swiss-based electric scooter company VMAX was also on hand, leveraging their US expansion last year and their local LA-based distribution center.

The company brought nearly all of their models of electric scooters to the show and I had the chance to try several of them out.

The small and low-cost ($349!) VMAX VX5 and its upgraded VX5 Pro electric scooter are surprisingly peppy for a so-called “entry-level scooter”, and I could easily hit the 18 mph (30 km/h) top speed. There’s no suspension, but the scooter is so light that it doesn’t seem to miss it.

I spent more time on the VX2 Extreme (and I also borrowed one for the few days I was in LA – more on that experience soon) and can tell you that the upgraded power is potent. In its highest power mode, the 1,600W rear hub motor would easily wheelie and I had to remember to keep more weight on the front of the scooter while accelerating or just not go full-throttle, like I’m used to on weaker scooters where the throttle is basically an on/off switch. With the VX2 Extreme, you can treat the throttle more like an actual variable accelerator instead of just mashing it all the way to take off. That’s how much power this light and nimble scooter unleashes. Pretty impressive for $799!

The last model I tried was the VMAX VX4, which adds some comfortable suspension and more speed, though is a bit heavier. You give up some portability to get that extra performance, so this isn’t one you’d want to carry for too long (unless you’re ok with hauling 60+ lbs around by hand), but it’s incredibly planted and comfortable for longer cruising at higher speeds.

Fly E-Bike

This was my first chance to see the expanded lineup from Fly, which is basically the go-to electric bicycle dealer in New York City. They’ve got dozens of retail footprints in the city and are the main supplier to all of those delivery riders you’ll see doing the important yet thankless work of criss-crossing the city to bring food and deliveries to residents in mere minutes.

While Fly is known for its electric bicycles, the company has expanded into nicer-looking and higher-performance electric seated scooters and motorcycles.

I was shocked to see the impressive designs at the booth, especially since I had long associated Fly with all of those electric bikes with massive batteries meant for all-day delivery riders and not heavier duty motorcycles like these.

BikeOn electric bike conversion kit

The BikeOn conversion kit is one of the most highly engineered kits I’ve seen for converting a standard pedal bike into an e-bike.

It mounts in under 30 seconds to nearly any bicycle, attaching its bright red anodized gear ring to the largest sprocket on a bike’s rear cassette. It includes a built-in torque sensor that measures the force applied to the chain, allowing the small yet powerful motor to power the rear wheel directly.

The entire kit weighs just 3.8 lb (1.7 kg) without the battery, and that little motor is rated for either 250W or 750W, depending on the market. There’s even a compatible Android and iOS smartphone app that you can use as the kit’s dashboard.

The battery fits in a water bottle holder, and adds just 3.3 lb (1.5 kg) to the bike. It’s fairly small at 250 Wh, but they say it can add 20 miles of range to the bike.

This kit is not cheap, priced at US $1,246 without a battery or US $1,599 with a battery. You can buy very nice complete electric bicycles for that price, but that’s not really the point of this kit. Instead, this is designed to allow riders to convert a bicycle that they already own and love – especially nicer, high-end bicycles that you wouldn’t want to bolt a bunch of heavy gear onto.

Oh Wow Cycles

Oh Wow Cycles has some of the biggest – and coolest – electric bicycles I’ve ever seen. This company’s electric trikes are simply out of this world. Sure, they’ve got more “normal” two-wheeled e-bikes too, but the rickshaws are what really catch your eye. And that’s exactly what happened at the show, with these big people movers instantly drawing me into the booth.

The new Conductor Plus is basically the minivan of the e-bike world, providing ample seating in the back for multiple children or even adults! And as a double-duty electric trike, the bench seat actually folds forward to convert into more of a pickup truck bed for cargo or pets.

Unlike some trikes, which require you to bust out your hex wrench set and swap accessories to convert from passengers to cargo-carrying setup, this e-trike can convert in two seconds without the need for any tools.

There are also an option for dual batteries, which is a good idea for anyone planning on longer rides or using this e-bike for more commercial-style delivery duty.

I was also fortunate to have the chance to meet the company’s founder, Ash Soliman, and get a tour of the new models with him at the company’s booth. It was refreshing to see how excited Ash is about these e-bikes, especially for their use in so many roles from family transport to cargo duties and more.

These are definitely some awesome models to check out if you want the kind of heavy-hauling capabilities that expand beyond those of a traditional e-bike or even cargo bike.

Tempo e-bike insurance

Getting your electric bike stolen is an awful feeling. I’ve been there. Multiple times. Not only does it feel like a personal violation, but you’re left with a serious financial loss since most e-bikes are well over $1,000.

Fortunately, there’s a new electric bike theft insurance program called Tempo that sounds like exactly what I need – and probably what you need, too.

The company’s founder, Michael Keating, explained to me how the system works. In a nutshell, you pay US $199 and you get three years of theft protection – basically $5.50 per month. That protection includes active theft recovery by working with bike registries and local law enforcement. As part of the membership, riders get a registered bike number stamped on multiple anti-theft stickers designed to alert thieves of the active recovery program, and the stickers also include a special UV pigment so they still leave a mark on the bike even if removed.

If a bike is stolen, Tempo does its best to get it back using all of its various tools and connections in the industry. If they can’t get your bike back, you get up to $2,500 from Tempo to replace the bike. If you’re riding any of the mostly sub-$2,500 electric bikes in the US (the vast majority of all e-bikes), that’s a pretty great deal. If you’re on a $10,000 S-Works e-bike, you may want to look for a different insurance program.

Hyryd hydrogen-powered e-bikes

I first had the chance to see Hyryd’s hydrogen-powered electric bikes at the Micromobility Europe 2024 show, and now the company most recently showed off their technology in the US at Micromobility America 2024.

Unlike nearly all other e-bikes, which store energy in a battery, the Hyryd e-bikes use a small hydrogen tank combined with a fuel cell to generate electricity that powers the rear-wheel motor.

The bikes themselves are designed for the European market and thus don’t have the same power we’re used to in the US, but the technology is neat to see in action.

I’m not sure this is the future of e-bikes, and in fact I’m fairly sure it isn’t. But if they can find some niche use such as in sharing or commercial fleets where a central electrolysis machine can refill hydrogen bottles in a depot, then perhaps there’s something to this.

E-Cuffs scooter lock

This one caught me by surprise, but it was neat to see these new scooter handcuff-style locks from E-Cuffs.

They use a quick-release system, so they can stay mounted on the scooter’s stem for normal use and then pop off for quick locking to various objects.

Scooters can represent a tricky locking problem since they rarely have a good triangle like e-bikes to secure a lock onto the frame. But with the E-Cuffs, an e-scooter can be conveniently locked around its stem or downtube.

Joyride Revii

We’ve seen Joyride at several events in the past, showcasing the company’s connected platform that makes it easy for startups or established companies to operate fleets of smart-connected micromobility vehicles. Want to open your own Bird scooter startup? Joyride can get you up and running easily with your own fleet of digitally integrated scooters that all phone home.

Now the company is demonstrating off a new platform called Revii for larger micromobility vehicles (sometimes referred to as “minimobility”) including golf carts, Low-Speed Vehicles (LSVs) and other Neighborhood Electric Vehicles (NEVs).

The app works similarly to Joyride’s micromobility platform, but makes it easier for hotels, resorts, convention centers, or other operators of vehicle fleets like these to manage and control their vehicles.

As these important car-replacing vehicles become more common, and more locations begin offering fleets for rental, shared, or other commercial uses, Revii’s platform could become increasingly common in the space.

Ryvid electric motorcycles

Electric motorcycles were also a big part of the show, with Ryvid sharing test rides on its US-built Anthem and Outset electric motorcycles. Both feature Ryvid’s proprietary removable battery design, allowing motorcycle owners to park outside and roll their large battery into their garage or apartment to charge from a wall plug. You can even take it up into a tall apartment building as long as you’ve got an elevator!

The Anthem also has a number of other cool features, such as its actuator-controlled adjustable frame, which lets riders move the seat up and down by as much as four inches (100 mm), even while riding.

The Outset is built on a similar frame, though lacks the actuator. It’s built more like a dual-sport bike and will likely make off-road riders feel more at home than the obviously commuter-oriented Anthem. At under $6k, it’s also very attractively priced – though the Anthem’s $6,495 price is also quite enticing.

Both bikes are capable of highway speeds into the 70’s of MPH, and can achieve city ranges of up to 70 miles, though highway commuting will quickly drop that range.

I also had the chance to try the updated Anthem at the Outset, sneaking them out of the show grounds for some street riding. The Outset I tested even had Ryvid’s higher-power ASI controller, which offers a major power upgrade for riders who want even more performance.

These are incredibly well-designed electric motorcycles, though you have to remember that they’re designed for local riding first. With a 4 kWh battery, they just aren’t meant for touring or long-distance riding. But for anyone who commutes 20 miles to work and wants a fun, inexpensive, and efficient electric vehicle to turn that slog of a commute into a joyride, this is the way to go!

Land Moto

Land Moto also boasts US manufacturing for its commuter-level electric motorcycles, which carry their own unique design styling. This was my first chance to see Land Moto’s bikes in person and they were definitely head-turners.

Starting at $6,995, the Land Moto District comes in street and dirt versions, with both claiming a max speed of 70 mph (112 km).

They also tout a max range of 120 miles (193 km), though that’s from the largest battery option with 4.8 kWh of capacity. The base model has a 1.8 kWh battery that claims a more conservative 40 miles (64 km) of range at slower city speeds.

The ability to dial in the battery capacity (and its effect on pricing) allows riders to choose exactly what they need, which is a rare feature in this industry.

Shandoka electric motorcycle conversion kit for classic motorcycles

This one is absolutely fascinating. Check this out: Shandoka is an electric motorcycle conversion kit company that has developed a patented conversion system that fits a wide range of classic motorcycles. The system includes a battery and controller setup that mounts in the frame in place of the original combustion engine, and a rear hub motor that replaces the previous rear wheel.

It allows riders to breathe new life into older bikes, especially those that suffer from engine problems but otherwise still have structurally sound frames and components that could easily be put back onto the road with a new powertrain.

And because most of these bikes were originally produced in the 1980s, they are usually grandfathered into those older regulations making these types of conversions incredibly easy to perform.

These bikes in the pictures from the show are all naked showing off the engineering that went into the design, but they can also be buttoned back up or covered in a builder’s own custom body panels to create unique new designs.

The brainchild (and labor of love) of Ernest Eich, these conversion kits are built in the company’s North Carolina facility, showcasing yet another example of US manufacturing for electric motorcycles and their components.

I had the chance to chat with Ernest at the show, and this is a company that we’ll definitely want to take a deeper looker at soon.

There’s always more to come

While this can’t cover everything at the show, it’s a collection of some of the most interesting and standout examples of micromobility in all of its diverse forms.

As the industry continues to grow and mature, bouncing back from a rollercoaster of highs and lows since the beginning of the pandemic years, we’re expecting to continue seeing more innovation and interesting designs like these.

Stay tuned for some deeper dives into several of these companies as we explore what makes their light electric vehicles and production processes unique.

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Rising costs, market conditions blamed for Volvo Cars’ 2026 price hike [update]

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Rising costs, market conditions blamed for Volvo Cars' 2026 price hike [update]

A leaked 2026 order guide shows the price on several Volvo models going up by nearly 6%. That’s thousands of dollars on some models – along with higher destination charges, fewer discounts, and precious little in the way of new tech or features to justify the price hike.

UPDATE: Volvo Cars has a response.

When we originally published this article a few days ago, we I commented that customers being saddled with the across-the-line price increases coming to Volvo dealers in 2026 would get “precious little” in return for those extra dollars.

Volvo Cars apparently disagrees, and a Volvo rep reached out via email to share some background on the changing prices. “We evaluate every aspect of our business in pricing decisions, in line with our standard practice,” they wrote. “For MY26, we have made significant upgrades to the in-car technology across our lineup, as well as major improvements to our top-selling XC60 in the areas that matter most to our customers. These upgrades are reflected in the new price structure, along with price increases driven by challenging current market conditions.”

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I asked if they could specify what some of the “significant upgrades to the in-car technology across our lineup” were.

You’ll be able to see more about the upgrades in our (02JUN2025) press release,” came the reply. “Some major ones include the introduction of the next-generation Snapdragon® Cockpit Platform from Qualcomm Technologies, which Google Android Automotive-based infotainment system to run more than twice as fast as outgoing models.”

You can check out the press release for yourself at the link, then let us know whether or not having a touchscreen that’s twice as fast as the one you have now is worth as much as $3,200 to you in the comments.

Original post, below.


CarsDirect is reporting that Volvo Cars is raising US prices across the board by as much as 6% for the coming year, translating to a $3,200 price increases on some of the Swedish brands’ most popular plug-in SUVs and crossovers.

Based on what we’ve seen so far, the 2026 Volvo XC90 appears to have the largest price hike of $3,200 on the plug-in hybrid variant. The XC90 T8 Core PHEV has an MSRP of $76,200, excluding destination, $3,200 more than the current price tag of $73,000. That represents a 4.4% price hike compared to the 2025.5 plug-in.

In the case of the 2026 Volvo XC60, we found a 5.6% price increase on the base model, which is going up $2,650 from $47,050 to $49,700. On average, we’re seeing a 4.2% price hike on the Volvo V60, V90, XC40, XC60, and XC90, depending on the trim level, with the increases ranging anywhere from $1,800 to $3,200.

CARS DIRECT

It gets worse for new Volvo buyers. The company began quietly cancelling rebates and dialing back financing incentives last month, after the Trump Administration announced new, sweeping tariffs on imported cars this past April.

For its part, Volvo Cars doesn’t seem to be blaming these new price increases on the tariffs themselves, citing rising costs and market conditions instead. That said, those tariffs have undoubtedly influenced the company’s decisions and market plans – especially those regarding the all-new XC70 and 2025.5 S90 PHEV models as well as the new ES90 battery-electric sedan.

Volvo isn’t the only brand raising prices. BMW will increase prices starting 01JULY by about 2%, and Ford raised prices on cars and trucks made in Mexico by about $2,000 last month.

If you’re in the market for a new Volvo XC90 PHEV or EX90 EV and want to avoid the 2026 price increases, it doesn’t look like there are many tangible differences coming (the XC60, to Volvo’s credit, will be getting a series of updates similar to those on the well-received 2025.5 XC90 for 2026). You can find local deals on those models, below.

SOURCES: CarsDirect; featured image by Volvo Cars.


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Ford’s electric Super Mustang Mach-E wins class in a tough Pike’s Peak race

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Ford's electric Super Mustang Mach-E wins class in a tough Pike's Peak race

At the 103rd running of the Pike’s Peak International Hill Climb, electric cars once again impressed as Ford’s Super Mustang Mach-E won its class on a difficult race day where running was limited due to inclement weather.

The Pike’s Peak International Hill Climb is one of the longest-running races in the world, being held 103 times since 1916.

It’s a famously difficult race, starting at an already-high 9,390ft (2,862m) in elevation and finishing at 14,110ft (4,300m), with an average 7.2% vertical grade. Until 2011, the track was largely unpaved on dirt or gravel roads, and it is still not uncommon for cars to leave the track and crash into the woods or, worse, end up tumbling down the mountain. The race is also commonly stopped by rain, snow, fog, or other inclement weather… of the type you commonly get at the top of mountains.

In particular, the high altitude nature of the race (which earned it the nickname “Race to the Clouds”) has always been difficult, because at high altitudes there is less oxygen, which means less complete combustion of fuel. This means that gas-powered race vehicles need to have incredibly oversized engines to do well.

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That difficulty does not apply to electric vehicles since EVs don’t need oxygen for combustion, so for years EVs have overperformed in the race.

In fact, the all-time record for the 12.42-mile (20km) hillclimb, 7:57.148, was set by the all-electric Volkswagen ID.R in 2018, driven by Romain Dumas (put a pin in that name).

So EVs do well here, and it’s pretty common for manufacturers (or private teams) to bring them to show off.

Last year, EVs performed exceptionally well, with electric entries from Ford, Rivian and Hyundai each topping their respective categories.

The R1T Quad Max set a production truck record (gas or electric), the Ioniq 5N set a record for unmodified EVs (which the R1T Quad Max had set about 5 minutes earlier) and was a mere three tenths of a second off of the overall production SUV record, and the Ford SuperTruck set the fastest time of the day, but didn’t set an actual record because it lost about half a minute when it suddenly lost power on the course and needed a reboot. Had it not had that shutdown, it would have beaten Ford’s SuperVan’s class record from the previous year.

Ford’s entry this year: the bonkers 1400hp Super Mustang Mach-E

So, Ford had its work set out for it this year, but it brought the right car for the job.

The successor to Ford’s ridiculous 1400hp SuperVan and SuperTruck is the Super Mustang Mach-E, using a similar powertrain to the last two vehicles, but this time in a form factor that’s actually appropriate for racing (and… kind of looks nothing like a Mach-E, though we’d love to see a Mach-E like this on the road). Instead of a giant box, it actually looks like a race car. What a concept!

Mach-E Pikes Peak
Source: @FordPerformance/Instagram

The new incarnation doesn’t just look more fit for purpose, but a smaller and lower vehicle helps performance in several ways, especially in a hillclimb. A smaller vehicle means less weight to haul up a mountain, a smaller front cross-sectional area means less drag, and a lower weight distribution means better handling on the twisty track.

The car also has 6,125lbs of downforce, important in the thin air of the mountain on those twisty turns.

And remember that name I told you to put a pin in earlier? Well, Ford hired overall record-holder Romain Dumas to drive its entry again, showing that it’s serious about trying to set a record. The VW ID.R was a purpose-built beast, so it would be a tough attempt, but their driver choice proves they’re serious about winning this race.

Three other interesting EVs ran this year

A few other EVs ran this year, but the others weren’t necessarily vying for the top overall spot.

One is an Ioniq 5N, race prepped by Evasive Motorsports. It’s been heavily modified with a stripped interior saving 500lbs of weight, aerodynamic wheel covers, new suspension, and a new bodykit with enhanced aerodynamics. Evasive previously ran a modified Tesla Model 3 up the mountain, but had an electrical issue on that race.

The next is the confusingly-named Honda CR-V e:FCEV, a fuel cell plug-in hybrid vehicle (more on that car here). It ran only mild modifications supplied by Honda Racing Corporation, with a lowered suspension, racing brake pads, and upgraded wheels and tires, along required safety improvements like a roll cage.

And the most fun one is a “Volkswagen Fun Cup” car. Fun Cup is a European racing series, with vehicles that have bodywork based on classic VW beetles. But instead of the standard 1.8L engine used in that series, this one has been engine-swapped to electric by Electric Classic Cars. They’ve dubbed it the “BugZappa.”

Weather reared its ugly head, as it often does

Pike’s Peak has a well-earned reputation for difficulty, and today’s race put the tough conditions on display.

The race start was delayed due to high winds which were blowing rocks and debris onto the track near the peak. Eventually it was decided that the race would be held only over the bottom half or so of the track – from the start at 9,390ft through Glen Cove, at 11,440ft (see photo).

This put EVs at a slight disadvantage compared to normal running, considering they gain more and more ground against ICE cars at higher and higher elevations where combustion is more difficult in the thin air.

However, EVs still impressed regardless.

How the EVs did

The Honda, piloted by Daijiro Yoshihara, was the first car to run on the day. It managed to finish the shortened course with a time of 5:55.744. It had no record hopes, but given that it’s the first hydrogen vehicle ever to compete in this hillclimb, you could kind of call it a record (but not really, given that weather forced everyone to only run the short course today, so there’s really nothing to compare against).

Not long after, Evasive’s race-prepped Ioniq 5N took its shot and Robert Walker set a more representative benchmark time of 4:23.858. A full minute-and-a-half improvement over the CR-V’s time, even over this shortened course, shows the significant difference between a commuter car and a race-prepped performance vehicle. The Ioniq 5N’s time held onto the top spot for a while, as several gas competitors followed, including Porsche GT4 and GT3 cup cars. It only fell once some of the serious purpose-built or open-wheel racecars from the Pike’s Peak Open, open wheel, and unlimited classes crossed the line.

One of those purpose-built cars was the aforementioned Super Mustang Mach-E, running in the Pike’s Peak Open class. All eyes were on this entry and Dumas as the driver, expecting it to set a top time for the day, and it did. The Super Mustang Mach-E finished with a time of 3:42.252 on the short course, setting the best time in its class by a longshot… but only the second-best time overall.

The restricted running turned out to be Ford’s downfall, as the ultralight prototype racecar, the Nova Proto NP01, piloted by Simone Faggioli managed to set a 3:37.196, beating the Ford by five seconds. The NP01 ran in the looser-rules “unlimited” class, so Ford still managed a class win in the more-restrictive Open class, but Dumas wouldn’t be crowned “King of the Mountain” on this day.

In an interview after the race, Dumas said his Ford would have likely had the advantage if the full track was open, due to lighter air at the top, but that “the mountain decides.”

One more EV, the “Fun Cup” car, will run later today, but we wanted to get an article up as soon as the top qualifiers finished their laps, as the rest of the cars running today are not contenders for the top spot. We’ll update this post later with the Fun Cup’s performance when it runs, or you can tune into the livestream of the rest of race day on youtube.


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Shipping threats around Arabian Peninsula rising, largest global shipowners organization warns

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Shipping threats around Arabian Peninsula rising, largest global shipowners organization warns

Refrigerated containers of Maersk shipping lines are stacked at the container terminal of Bremerhaven port on April 22, 2025 in Bremerhaven, Germany.

Focke Strangmann | Getty Images News | Getty Images

The world’s largest direct-membership organization for shipowners, charterers, shipbrokers, and agents is warning that while it is still unclear how Iran will respond to Saturday’s U.S. attack on Iran’s nuclear facilities, the threat to commercial shipping in the waters around the Arabian Peninsula has risen.

“The Houthi threat against shipping in the Red Sea and Gulf of Aden has also gone up,” said Jakob Larsen, head of security at Bimco, which represents global shipowners. “The Houthis now threaten merchant ships with affiliation to Israel or the U.S., but attacks against merchant ships with other affiliations cannot be ruled out.”

Larsen said it is expected that U.S. warships and merchant ships affiliated with Israel or the U.S. would be the preferred targets for the Iranians.

In an email to CNBC, a Hapag Lloyd spokesperson tells CNBC, “We currently are still crossing the Street of Hormuz. Alert level is high, though, and things might change by the hour.”

Integrated logistics provider Maersk announced Friday it is temporarily suspending port calls to Israel’s largest container port, Haifa. The $4.2 billion cargo facility at Haifa, owned by Adani Group, has been a target of Iranian missiles but has not suffered any damage. Last week, Jugeshinder “Robbie” Singh, CFO of the Adani, debunked misinformation posted that the port was on fire from a strike on Iranian social media.

Bimco’s Larsen warned Iran could attempt a wider disruption of commercial shipping in the Strait of Hormuz through attacks on merchant ships. Antiship missiles or drones of both airborne and surface types could be used in these attacks, he said.

“The laying of sea mines would constitute another dangerous development, but Iran’s intent to do so is questionable due to the risk to Iran-affiliated commercial ships and the risk of environmental disaster in case a ship is damaged,” said Larsen.

The Strait of Hormuz, which connects the Persian Gulf to the Arabian Sea, is recognized as one of the world’s most important oil chokepoints. The inability of oil to traverse through the Strait of Hormuz, even temporarily, can ratchet up global energy prices, raise shipping costs and create significant supply delays. In 2023, oil flows through the waterway averaged 20.9 million barrels per day, according to the U.S. Energy Information Administration, accounting for about 20% of global petroleum liquids consumption.

“Given the Iranian threat to U.S. military bases in the region, availability of warships for protection of commercial shipping is probably limited, especially for commercial ships with no affiliation to the U.S. or Israel,” Larsen said.

The Strait of Hormuz handles less than 4% of global container trade but the ports of Jebel Ali and Khor Fakkan are critical intermediary points for global shipping networks in the region.

The majority of cargo volumes from those ports are destined for Dubai, which has become a hub for the movement of freight with feeder services in the Persian Gulf, South Asia, and East Africa.

The conflict in the region has also sparked ocean freight rates to surge from Shanghai to Jebel Ali, the Arabian Gulf’s largest port.

Freight intelligence firm Xeneta said average spot rates have increased 55% month-over-month, prior to the conflict escalation between Israel and Iran. Rates are now $2,761 per forty-foot equivalent unit (FEU), a standard unit for measuring the capacity of container ships and volume of cargo.

On the tanker side, spot rates for very large crude carrier (VLCC) voyages between the Middle East and China are up 154% week-over-week. Rates on the long-range tankers’ (LR2) Middle East-Japan trade route are up 148% and Middle East-Japan very large gas carrier (VLGC) rates are up 33%.

Closure of Strait of Hormuz would be "carnage", says Shipping Analyst

The reason behind the increase in rates includes the added expenses on security measures, higher bunker fuel prices, and fuel costs as vessels use more fuel due to faster sailing through high-risk areas.

Marsh McLennan, the world’s largest marine insurance broker, noted hull and machinery insurance rates for vessels transiting the Strait of Hormuz have increased by more than 60%.

In light of the latest wave of defense measures, Bimco is encouraging shipowners to review their security risk assessments and carefully consider mitigation measures.

“Merchant ships in the area should consider reducing their exposure to threats from Iran, for example, by routing away from the Iranian coast,” said Larsen. “We also recommend that ships maintain close contact to naval forces in the area through UK Maritime Trade Operations, maintain strong vigilance and increased lookout, report suspicious sightings and events to UKMTO, and increase the resilience of ships to absorb damage by ensuring watertight integrity and readiness of damage control organization including firefighting capability.”

“Bimco never directly recommends shipowners to completely stay away from a conflict area. Such a decision should be taken by the shipowner, taking into consideration all relevant factors of the security risk assessment, including, for example, the threat, the ship’s vulnerabilities, and the risk acceptance level of seafarers, the shipowner, and the cargo owner.”

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