Regional QHSE & Compliance Manager – Americas

Dear Valued Customer,

Following our previous Customer Advisories, we are providing an updated consolidated view on the ongoing geopolitical escalation in the Middle East and its continued, very critical impact on global air and ocean supply chains. As widely reported in the news, the situation has further deteriorated in recent days. What initially began as a regional disruption has clearly evolved into a global supply chain crisis, affecting capacity, congestion, transit times, service reliability, and logistics costs worldwide. The environment remains highly volatile, fluid, and subject to sudden change.

Employee Safety and Operational Status:

Employee safety remains our highest priority. At this time, all Pentagon employees in the affected areas remain safe. As a precautionary measure and in line with local authority guidance, Pentagon continues to operate work-from-home arrangements in the UAE and Iraq, with our yard and warehouse teams operating on as required basis while office attendance in Oman and Qatar remains normal. Pentagon remains fully operational across the region, with teams closely following all local safety instructions and protocols.

Global Energy Impact and Carrier Surcharges (Air & Ocean):

Global energy markets remain under extreme pressure. Oil prices have risen sharply following the escalation of hostilities and ongoing uncertainty around critical maritime corridors, particularly the Strait of Hormuz. As a direct consequence, all major air and ocean carriers continue to announce and expand cost recovery measures across their global networks, including but not limited to:

• Emergency Fuel Surcharges and Emergency Bunker Adjustment Factors (EBAF)
• War Risk, Security, Congestion, and Market Disruption surcharges
• Peak-type surcharges and general rate increases
• Expanded surcharge applicability beyond traditional Middle East trade lanes

It is important to emphasize that these surcharges are not driven solely by fuel increases. They also reflect:

• Loss of effective capacity due to rerouting and longer transit times
• Higher insurance and war risk premiums
• Network imbalances, equipment shortages, and congestion
• Increased operational and security costs

These measures are global in nature and are impacting shipments worldwide, not only those moving to, from, or via the Middle East.

Air Freight – Current Impact and Global Implications:

Air freight conditions remain extremely challenging. Despite short periods of partial stabilization, capacity to and from the Middle East has tightened again, with several carriers announcing further service suspensions, reductions, or last-minute schedule changes.

Current conditions include:

• Severely constrained capacity on Middle East trade lanes
• Ongoing cancellations and short-notice schedule changes
• Payload restrictions due to longer routings and higher fuel uplift
• Elevated risk of delays, rollovers, and backlog accumulation

The continued loss of Gulf hub transit capacity—particularly impacting Asia–Europe and Asia–Americas flows—is generating significant global knock-on effects. Cargo from Southeast Asia, the Indian Subcontinent, and Oceania is increasingly being rerouted via China and Hong Kong, leading to:

• Further tightening of global air freight capacity
• Increased congestion at alternative hubs
• Sustained upward pressure on air freight rates

All major airlines have announced global Fuel Surcharge (FSC) increases, reflecting both rising fuel prices and broader market disruption.

Middle East Airport Updates

Ocean Freight – Current Impact and Maritime Developments:

Ocean freight continues to face structural and escalating challenges. Heightened security risks across key maritime corridors—including the Strait of Hormuz, Red Sea, Bab el Mandeb, and the broader Suez Canal corridor—are materially disrupting vessel operations.

• Following recent war risk insurance decisions:
• Multiple ocean carriers have suspended or restricted services to the Arabian Gulf
• Booking acceptance remains limited and subject to frequent change
• Containers already released for export stuffing may no longer be accepted
• Vessels enroute may be diverted to alternative safe ports

While ports such as Salalah have partially reopened, operations remain constrained. Congestion and slower handling continue across several regional hubs.

As carriers increasingly reroute vessels via the Cape of Good Hope, the market is experiencing:

• Significantly extended transit times
• Reduced effective vessel and equipment capacity
• Substantial additional fuel and operational costs

These effects are now creating global ripple impacts well beyond the Middle East region.

Strait of Hormuz – Ongoing Risk and Uncertainty

Iran has communicated that non-hostile vessels may transit the Strait of Hormuz under specific conditions; however, restrictions based on perceived vessel affiliation remain subject to interpretation. Given the strategic importance of the Strait—through which a significant share of global oil and LNG normally transits—any further escalation or restriction continues to represent a major risk to global trade, energy markets, and freight costs. Advance coordination, risk assessment, and contingency planning remain essential.

What This Means for Your Shipments

• Ocean shipments to the Middle East and Gulf region require explicit and updated carrier booking confirmations
• Shipments already loaded or positioned will be managed case by case to mitigate unnecessary cost exposure
• Cargo already at sea may be diverted, requiring revised onward instructions
• Temporary storage solutions can be arranged where appropriate to limit demurrage and detention
• End-of-Voyage Declarations may be issued by carriers.

Ocean Freight – War Risk and Emergency BAF

• All major ocean carriers continue to expand Emergency BAF applicability across global networks

These surcharges reflect fuel, security, insurance, rerouting, and operational cost increases and are not limited solely to Middle East routes.

Middle East Port Updates

Inland Transportation:

Sustained high energy prices are also impacting inland transportation globally. Trucking, rail, and feeder services continue to adjust fuel indices, resulting in higher first- and last-mile costs, drayage charges, and inland haulage rates across multiple regions. Within the Middle East in addition to rising fuel costs there is dramatic increased demand for trucks given the increase in

Pentagon Mitigation Measures and Customer Guidance:

Pentagon remains fully mobilized globally to:

• Monitor carrier, port, airspace, insurance, and regulatory developments in real time
• Deploy alternative routings and multimodal solutions where feasible
• Secure and prioritize capacity for critical shipments
• Support customer contingency planning through clear and timely communication

Recommended customer actions:

• Share updated shipment forecasts where possible
• Confirm bookings as early as feasible
• Review insurance coverage, including war risk provisions
• Consider flexible routing and transit time alternatives
• Factor ongoing congestion and cost volatility into planning

We strongly recommend remaining in close contact with your Pentagon account representative to review shipment-specific risks, mitigation options, routing alternatives, and potential cost implications prior to execution.

This situation remains highly fluid. Pentagon will continue to monitor developments closely and will issue further updates as conditions evolve.

Your supply chain continuity—and the safety of our people—remain our top priorities.

Yours Sincerely,

Pentagon Middle East & India Management Team.

Dear Valued Customer,

Following our previous Customer Advisories, including our update of 16 March 2026, we are issuing this communication to provide a further current status update on the evolving geopolitical situation in the Middle East and its continued global impact on air and ocean supply chains.  What began as a regional disruption has clearly developed into a global supply-chain event, impacting capacity, congestion, transit times, service reliability, and logistics costs well beyond the Middle East. The situation remains highly dynamic and continues to evolve on a daily basis.

Employee Safety and Operational Status

Employee safety remains our highest priority. At present, all Pentagon employees in the affected areas remain safe. As a precautionary measure and in line with local authority guidance, pentagon continues to operate with work-from-home arrangements in Qatar, and the UAE. Pentagon remains fully operational across the region.

The ongoing geopolitical situation in the Middle East has resulted in temporary closures of some ports and airports in the region for safety reasons, with operations restarting after all clear communicated from relevant authorities.   With airspace across the UAE and neighbouring Gulf countries only partially open, air shipments continue to be received from key origins, though at significantly reduced volumes compared to pre-crisis levels.

Air Freight – Current Impact and Global Implications

Air freight capacity across the region remains extremely constrained. Gulf carriers have gradually resumed limited freighter operations, primarily for repositioning, essential cargo, and backlog clearance, subject to regulatory approval. At the same time, several international carriers continue to suspend services to certain destinations, while national carriers operate on a reduced and highly selective basis.

As a result:

• Overall air freight capacity remains very limited
• Flight schedules and routings are subject to short-notice changes
• Delays, rollovers, and space constraints should be expected

The impact is now spreading well beyond the Middle East. Cargo flows from Southeast Asia, the Indian subcontinent, and Oceania are increasingly being rerouted via China and Hong Kong, placing additional pressure on trade lanes that were previously less affected. This has led to:

• Further tightening of capacity across the global air freight network
• Increased congestion at alternative hubs
• Continued upward pressure on rates

Global Air Freight Implications

• Reduced global capacity: Aircraft redeployments, route extensions, and service suspensions are tightening availability across key trade lanes.
• Far East–Europe & Asia–Middle East corridors: These lanes are seeing particularly strong capacity constraints.
• Rate volatility: Ongoing upward pressure on air freight rates is expected due to sustained capacity limitations.
• War risk and fuel surcharges: Airlines continue to introduce or review war risk surcharges and fuel surcharge adjustments as geopolitical risks and fuel prices remain elevated.

Customers should anticipate potential delays or cancellations, limited space availability, and short-notice rate adjustments in the coming days and weeks.

Middle East Airport Updates

Ocean Freight – Current Impact and Maritime Developments

Ocean freight continues to face more severe and structural challenges. Following recent decisions by marine insurers regarding war risk coverage, many shipping lines have stopped accepting new bookings to and from the Middle East. Expanded exclusion zones across parts of the Gulf of Oman and surrounding waters have further limited carrier operations.

As a result:

• Several shipping lines have suspended services to the Arabian Gulf
• This suspension also applies to empty containers already released for stuffing and intended for export
• Vessels currently enroute are being diverted to the next safe port of discharge

Ports in Oman, including Salalah and Sohar, were temporarily impacted following confirmed incidents. Salalah and Sohar have since reopened, though operations remain constrained. The UAE ports of Khor Fakkan and Fujairah remain operational, but congestion and slower handling times persist due to capacity limitations. There are limited feeder operations available from Sharjah and Jebel Ali to Upper Gulf Ports of King Hamad (Qatar), Bahrain, Dammam (Saudi Arabia) and Umm Qassr (Iraq), however space is very limited and subject to additional war risk and other surcharges.

Alternative routing via Saudi Arabian ports, including Jeddah and King Abdullah Port, remains feasible. However, many importers are currently delaying new orders amid uncertainty and in anticipation of potential de-escalation.

What This Means for Your Ocean Shipments:

• All ocean shipments to the Middle East and Gulf region require explicit, updated carrier booking confirmations, which remain limited and subject to change.
• Shipments already at sea may be diverted to alternative ports, where cargo will be discharged and made available for onward instructions.
• Available options may include delivery at the contingency port, onward transport by road or rail (subject to feasibility), or change of destination, all on a case-by-case basis.
• To mitigate exposure to storage, demurrage, or detention charges, Pentagon can—where appropriate and in coordination with you—collect and temporarily store cargo until departures resume.
• In certain cases, carriers may issue End of Voyage Declarations.

Alternative Air & Multimodal Routing – Ready to Operate for UAE & Qatar:

In line with our mitigation strategy, Pentagon in conjunction with JAS is ready to operate bonded air-to-road solutions into Dubai and Qatar, providing customers with a practical alternative while direct air capacity remains constrained. These solutions are fully prepared for deployment and can operate on a scheduled basis, up to three times per week, subject to shipment confirmation and operational feasibility.

Air Freight Gateways with Bonded Trucking into Dubai & Qatar:

• Dammam (Saudi Arabia): Air cargo via Dammam International Airport, with bonded trucking into Dubai or Qatar.
• Riyadh (Saudi Arabia): Air cargo via Riyadh, with bonded trucking into Dubai or Qatar.

These options are designed to support shipment continuity into Dubai and Qatar under current conditions. Transit times, availability, and costs will be assessed case by case.

Cross Border Trucking within Middle East:

To date all land borders within the GCC and Iraq are operational, however with some delays for increased security, we anticipate that there will be some congestion at key border points if this situation extends further. Truck availability is becoming an issue, and we are seeing an increase in rates for local and cross border movements.

Inland Transportation – Global Impact of situation

In addition to carrier surcharges, the sustained increase in oil prices is also impacting inland transportation costs globally. Higher fuel prices are affecting trucking, rail, and feeder movements to and from airports and seaports worldwide, leading to increased first- and last-mile costs, drayage charges, and inland haulage rates across multiple regions. These cost pressures are being observed well beyond the Middle East and are contributing to overall logistics cost escalation on a global basis.

Mitigation Measures and Customer Guidance:

Pentagon remains fully mobilized globally to:

• Monitor carrier, port, airspace, and regulatory developments in real time
• Deploy alternative routings and multimodal solutions where feasible
• Secure and prioritize available capacity for critical cargo
• Support customer contingency planning with clear, timely communication

Recommended Customer Actions:

To support continuity and planning during this period, we recommend that customers:

• Share updated shipment forecasts where possible
• Confirm bookings as early as feasible to secure limited capacity
• Review insurance coverage and any applicable regional restrictions
• Consider flexible routing and transit-time alternatives
• Factor potential port congestion into safety-stock planning

We strongly recommend remaining in close and regular contact with your Pentagon account representative for shipment-specific guidance.

As the situation continues to evolve rapidly, we remain in close coordination with our partners and local authorities. Our teams are actively adapting to changing conditions to minimize disruption and keep supply chains moving. This situation remains fluid. Pentagon will continue to monitor developments closely and will issue further updates should meaningful changes occur.

Your supply chain continuity—and the safety of our people—remain our top priorities. Your supply-chain continuity remains our top priority.

Yours Sincerely,

Pentagon Middle East & India Management Team.

Dear Valued Customer,

Following our Customer Advisory dated 9 March 2026, we are issuing this updated and consolidated communication to provide additional clarity on the rapidly evolving geopolitical situation in the Middle East and its ongoing global ripple effects across air and ocean supply chains. What began as a regional disruption has now clearly developed into a global supply chain event, impacting capacity, congestion, transit times, service reliability, and logistics costs well beyond the Middle East. The situation remains highly dynamic and continues to intensify worldwide.

Global Energy Impact and Carrier Surcharges

A sharp increase in oil and gas prices has materialized, and market observations continue to confirm this trend. As a result, airlines and ocean carriers have announced—or are expected to announce—multiple cost recovery measures, including:

• Emergency Fuel and Emergency Bunker Surcharges
• War Risk, Congestion, and Peak‑Season‑type surcharges
• General rate increases across air and ocean networks

These surcharges are not limited to routes to, from, or via the Gulf region and are impacting carriers’ entire global networks, affecting shipments worldwide.

Shipping Lane Closures and Global Maritime Impact

Heightened security risks across critical maritime corridors—including the Strait of Hormuz, Red Sea, Bab el‑Mandeb Strait, and the Suez Canal corridor—have materially disrupted vessel operations. Multiple ocean carriers have suspended or limited transits through these areas and are rerouting services via alternative routes, including the Cape of Good Hope, resulting in:

• Extended transit times
• Reduced effective vessel and equipment capacity
• Significant additional operational and fuel costs

As a direct consequence, feeder services into the Gulf are being reduced and further ripple effects across non‑Gulf trade lanes are expected. For the UAE the ports of Khor Fakkan and Fujairah are being used as alternate gateways and both Dubai Ports World and Abu Dhabi Ports have announced arrangements for transfer of cargo from these ports to Jebel Ali and Khalifa Port in Abu Dhabi for final clearances. Transfer will be by truck and rail, and costs will be borne by consignee. In addition to this the UAE Customs have created a “Green Corridor” between Oman Ports and UAE that allow transit of inbound and outbound containers via bonded corridors. There are now limited feeder services available between Jebel Ali and Sharjah Ports to upper gulf – Dammam, Bahrain, Kuwait and Umm Qassr, but space is limited and rates are fluctuating.

Port Congestion – Immediate and Near-Future Ripple Effects

Near-term congestion is expected at Gulf ports. In addition, increased transshipment pressure is anticipated at Asian hubs such as Singapore, Tanjung Pelepas, and Port Klang. As uncertainty around final delivery grows, carriers may temporarily cease loading Gulf-destined cargo, creating bottlenecks with global knock-on effects.

What This Means for Your Ocean Shipments

• Until further notice, ocean shipments to the Middle East and Gulf region require explicit, updated carrier booking confirmations, which remain limited.
• To mitigate exposure to storage, demurrage, or detention charges, Pentagon can—where appropriate and in coordination with you—collect and temporarily store cargo until departures resume.
• Containers already loaded or positioned for export will be handled case by case, in close consultation with you, with a focus on minimizing unnecessary cost exposure.
• For cargo already at sea, Pentagon is coordinating directly with carriers to determine discharge options, alternative ports, or continued transit.
• In certain instances, some carriers have begun to issue “End of Voyage Declarations” Additional costs, surcharges, and discharge-related expenses, including but not limited to handling, storage, and any ancillary charges, may apply in these instances. You will be responsible for payment of the additional costs in accordance with the Bill of Lading Terms and Conditions.

Ocean Freight – War Risk and Emergency BAF

All major ocean carriers have announced Emergency BAFs globally, reflecting increased fuel, security, and operational costs. These Emergency BAFs are global in nature and not limited solely to Middle East routes.

Airspace Restrictions and Global Airfreight Consequences

Widespread airspace restrictions across parts of the Middle East continue to severely impact global airfreight flows, reducing capacity, increasing transit times, and creating volatility in pricing and service reliability. While limited operations have resumed through select Gulf hubs, these remain constrained and focused primarily on essential cargo and backlog clearance. As a result:

• Effective capacity remains limited
• Payload restrictions and longer routings persist
• Rates continue to rise as demand shifts to alternative gateways
• The loss of Gulf transit capacity—particularly on Asia–Europe and Asia–Americas flows—continues to generate global knock‑on effects.

Middle East Airport Updates:

Air Freight – Fuel Surcharge Increases

On the airfreight side, all major airlines have announced Fuel Surcharge (FSC) increases, driven by the sharp rise in oil prices and broader operating cost escalation linked to the conflict. These FSC increases are being applied globally, impacting air cargo flows well beyond the Middle East.

What This Means for Your Air Shipments:

• Air freight shipments already in airline custody, including transit cargo via the Gulf, are currently stopped and temporarily stored at airports. Airport storage charges will apply and are significant.
• Customers may continue to register air shipments with Pentagon. Where appropriate, we can collect and store cargo more cost-effectively than at airports and dispatch on a first-come, first-served basis as capacity resumes.

Alternative Air & Multimodal Routing – Ready to Operate for Dubai

In line with our mitigation strategy, Pentagon is ready to operate bonded air‑to‑road solutions into Dubai, providing customers with practical alternatives while direct air capacity remains constrained.

Available gateways include:

• Muscat (Oman) – air cargo with bonded trucking into Dubai
• Dammam (Saudi Arabia) – air cargo with bonded trucking into Dubai
• Riyadh (Saudi Arabia) – air cargo with bonded trucking into Dubai

These solutions are fully prepared for deployment, subject to shipment confirmation and operational feasibility. Transit times, availability, and costs will be assessed case by case, please contact your Pentagon representative to find out more about these solutions.

Alternative Ocean Freight Contingency Routing

In addition to the above, Pentagon has built and activated effective contingency routing solutions for Ocean Freight, including:

• Alternative port options outside the most affected corridors
• Multimodal routing solutions, where operationally viable, to support continuity of supply

These solutions are being deployed case by case and will continue to evolve as carrier networks and port conditions change, please contact your Pentagon representative to find out more about these solutions.

Cross Border Trucking within Middle East

To date all land borders within the GCC and Iraq are operational, however with some delays for increased security, we anticipate that there will be some congestion at key border points if this situation extends further. Truck availability is becoming an issue, and we are seeing an increase in rates for local and cross border movements.

Pentagon Mitigation Measures & Customer Guidance

Pentagon remains fully mobilized globally to:

• Monitor carrier, port, airspace, and regulatory developments in real time
• Secure and prioritize available capacity for critical cargo
• Identify and deploy alternative routings where operationally viable
• Enhance shipment visibility and support customer contingency planning

We strongly recommend remaining in close and regular contact with your Pentagon account representative to review shipment-specific risks, mitigation strategies, and available options. This situation remains fluid. Pentagon will continue to monitor developments closely and provide updates as conditions evolve.

Your supply-chain continuity remains our top priority.

Yours Sincerely,

Pentagon Middle East & India Management Team