Executive summary

Global air freight has moved from a demand-led recovery into a disruption-led supply squeeze. The key driver is not weak cargo demand, but reduced effective capacity caused by Middle East airspace disruption, Gulf hub instability, elevated jet fuel costs, and carrier rerouting. Xeneta reported April global spot rates at USD 3.34/kg, up 30% YoY, the highest level since October 2022, while IATA’s latest official data showed March demand down 4.8% YoY and capacity down 4.7% YoY. The market is now stabilizing, but not normalizing. Rates have started to ease where capacity and fuel prices improve, yet Asia–Europe, South Asia–Europe, Middle East-linked lanes and selected Africa routings remain exposed. 

Global Economic & Trade Context 

The macro backdrop remains mixed: underlying trade activity is still supportive, but geopolitical and cost shocks are distorting logistics flows. IATA reported that global industrial production rose 3.1% YoY in February, while global goods trade increased 8.0% YoY, indicating that the cargo base entering Q2 was not structurally weak. Manufacturing indicators also remained expansionary, with global PMI at 51.4 and new export orders at 50.1 in March.  

The IMF’s April 2026 outlook projects global growth of 3.1% in 2026 and 3.2% in 2027, below pre-pandemic averages, with the Middle East war, higher commodity prices, firmer inflation expectations and tighter financial conditions as major headwinds. Its trade outlook also expects world trade volume growth to slow from 5.1% in 2025 to 2.8% in 2026, reflecting tariff impacts, front-loading and supply-chain adjustments.  

Energy is the most important cost variable for air cargo. IATA reported March jet fuel prices up 106.6% YoY, crude oil up 43.1%, and refining margins up sharply, directly increasing operating costs and surcharge pressure.

Market summary

Sources: Xeneta and IATA.  

Xeneta’s April reading confirms that pricing is being driven by scarce usable capacity rather than by a classic demand boom. The most stressed corridors were those dependent on Middle East airspace or Gulf carrier connectivity: in the week ending 5 April, Xeneta showed spot rates up 105% on South Asia–Europe, 87% Europe–Middle East, 84% South Asia–Middle East, 82% South Asia–North America and 72% Southeast Asia–Europe.  

By mid-May, the market began to show early relief. Air Cargo News reported that rates started to ease as jet fuel prices fell, although prices remained well above normal levels. Xeneta also cautioned that full recovery to pre-conflict service levels could take one to two months, because airlines need time to restore networks, rebuild operational confidence and manage insurance restrictions.  

Carrier strategies 

Carriers are acting defensively: 

• Capacity management: Airlines are restoring flights selectively rather than reopening networks wholesale. Capacity is returning first where safety, insurance and fuel economics are workable.  

• Network adjustments: Rerouting, technical stops, payload restrictions and alternative hubs remain common on Asia–Europe and Middle East-linked services.  

• Slot flexibility: IATA called for temporary suspension of the 80/20 airport slot rule during the Middle East crisis, indicating that rigid slot rules are becoming a constraint on network recovery.  

Regional Insights – Deep Dive

North America

• Main trend: More stable than Asia–Europe, but affected by global rate spillover. IATA showed North American March demand down 1.2% YoY and capacity down 1.1% YoY. 
  
  
• Biggest bottleneck: Distorted routings and uneven freighter availability. 
  
  
• Impact on rates and flows: South Asia–North America saw sharp rate inflation; North America–Latin America was comparatively steadier.
  
  
• Operational insight: Use North America as a relative stability zone, not a global benchmark.  

Europe

• Main trend: High exposure to Gulf transit disruption and jet fuel risk. European carrier demand still rose 2.2% YoY in March, but capacity rose faster at 4.2%, pressuring load factor. 

• Biggest bottleneck: Loss of reliable Middle East connectivity and fuel-cost volatility.  

• Impact on rates and flows: Asia–Europe and Europe–Middle East rates remain structurally elevated. 

• Operational insight: Prioritize direct lift, protected allocations and short quote validity.  

Asia

• Main trend: Strong production base, but most exposed to Middle East-linked capacity reductions. Asia-Pacific demand rose 5.4% YoY in March. 

• Biggest bottleneck: Payload restrictions, rerouting, fuel surcharges and limited direct Europe capacity.  

• Impact on rates and flows: South Asia/Southeast Asia to Europe saw the sharpest rate spikes. 

• Operational insight: Keep premium routings separate from deferred/economy products.  

Middle East 

• Main trend: Core disruption node. Middle Eastern carrier demand collapsed 54.3% YoY and capacity fell 52.4% YoY in March.

• Biggest bottleneck: Airspace restrictions, insurance risk, grounded/limited services, reduced hub confidence. 

• Impact on rates and flows: Cargo still moves, but via reduced freighter capacity, rerouting and alternative hubs. 

• Operational insight: Treat routings as constrained, not closed; confirm uplift before quoting.    

South Africa / Africa 

• Main trend: Demand support continues within broader Africa, where IATA reported +7.0% YoY demand and -4.6% YoY capacity in March. 

• Biggest bottleneck: Connectivity depth, freighter density and dependency on transit hubs. 

• Impact on rates and flows: Europe–Africa spot rates rose about 31%, reflecting Middle East hub disruption. 

• Operational insight: Secure space early for perishables, mining, project and time-critical cargo.  

South America 

• Main trend: More predictable than Asia–Europe and Middle East-linked corridors. Latin America/Caribbean demand rose 1.8% YoY, capacity 5.1% YoY.  

• Biggest bottleneck: Smaller market scale and lower carrier density. 

• Impact on rates and flows: North America–Latin America rates were broadly flat, while Europe–Latin America rose around 12% as capacity withdrew. 

• Operational insight: Use Miami and established gateway routings where reliability matters.  

Operational Insights 

• Published capacity overstates practical capacity. Rerouting, payload restrictions, fuel stops and security constraints reduce usable lift.  

• Fuel is now a pricing driver, not a background cost. Jet fuel volatility should be separated. 

• Spot exposure remains high. Customers requiring guaranteed uplift should expect premium pricing and shorter validity.  

• Middle East-linked flows need contingency routing. Alternative hubs, split shipments and deferred/premium product separation are essential.  

• Ocean disruption may temporarily support air demand. Some urgent cargo will shift to air, but this is likely tactical rather than structural.  

Market Outlook & Recommendations (Next 1–3 Months) 

The base case is firm but easing. Rates should soften from April peaks where fuel prices fall and airlines restore capacity, but normalization will be uneven. Xeneta expects recovery on disrupted corridors to take one to two months, and Air Cargo News’ mid-May reporting indicates that rate decreases have begun but from an elevated base.  

Recommendations for logistics teams 

• Separate base rate, fuel surcharge and risk premium in quotations to protect margin transparency.  

• Do not rely on schedule data alone; validate real uplift with carriers and GSAs before customer commitment.  

• Prioritize space protection for time-critical, project, pharma, aerospace, high-tech and perishables cargo.  

• Communicate clearly internally: the market is disrupted, not closed; cargo is moving, but with higher cost, longer transit risk and reduced reliability.  

Bottom line: May 2026 is not a demand-collapse market. It is a capacity, fuel and confidence shock. The winners will be forwarders that control routings, quote dynamically, and explain volatility before it becomes a service failure. 

Customer advice 

Considering the ever-changing market conditions and forces, please: 

• Let's closely monitor the developments in the US trade policy and the impending world events to maneuver potential challenges effectively in the logistics industry.
• Think ahead and book well in advance. Try to plan for 6 months ++.
• Consider that the market can change significantly. Further disruptions can happen anytime.
• Identify contract options that enable flexibility and resilience for your business.

However, it is our job at Bertling to keep global supply moving and do all we can and apply our knowledge, network and expertise to protect our clients’ while taking the latest market developments into account. We are there to find the best solutions to ensure cargo flows.

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