The immediate impact of Russia’s invasion of Ukraine on the world economy and container shipping is thus far fairly small, but that could change quickly, according to maritime analyst Drewry.

Some immediate consequences involved oil prices jumping to a seven-year high of USD100 per barrel hours after the invasion; stock markets around the world slumping, with Russian stocks falling particularly sharply and the rouble crashing to a record low; and commodity and energy prices surging.  

The fallout for international container shipping will likely take longer to materialise and the immediate operational threat is relatively low outside of the locality, said Drewry. Retaliatory cyber attacks that might affect shipping and fast-rising fuel costs are probably the main concerns right now.

Shipping will avoid the Black Sea for the foreseeable future – the Ukrainian port of Odessa was closed shortly after the invasion and carriers notified customers that the country would not be called at for the time being. But, in any case, there were only three inter-continental services (on the major trades that Drewry tracks) calling at ports in the region, so disruption to international liner networks will not be catastrophic.

“However, the outlook for container shipping is intrinsically tied to the global economy and it is a near certainty that Putin’s gambit will lead to more economic volatility, heaping even more inflation on to people all over the world still reeling from the pandemic,” the analyst added. 

“How consumers react to the high levels of inflation is one of the biggest wildcards when trying to predict the outlook for the container market. Global port handling growth has been slowing for the past few months and another sudden increase in the cost of living would only serve to diminish prospects further.

“There are some dark timelines ahead, including one in which China feels emboldened to copy Putin’s playbook in Taiwan, something that would hit shipping very hard.

“We can envision a scenario, which for the time being we will put as a very low probability, in which an inflation-racked economy leads to an unexpected contraction in container demand. It is within the realms of possibility that a trade slowdown will be steep enough to release some of the pressure on the container supply chain, giving ports the necessary breathing space to break out of the congestion cycle. War would be far too high a price to pay for that cure.”