Mapped: the impact of the West Asia crisis on global textile trade routes

The ongoing West Asia crisis has thrown open the extreme vulnerability of supply chains, including those of the garment and textile industry. FashionUnited has taken a look at why the Strait of Hormuz and the Bab-el-Mandeb Strait are such “jugular veins” of the textile trade between Asia and the West and what it means in terms of shipping times, costs and small businesses.

Strait of Hormuz

The Strait of Hormuz is a 21-mile-wide (around 34 kilometres) waterway between Iran and Oman. As the only sea passage from the Persian Gulf to the open ocean, it is a vital connection to the Arabian Sea and beyond.

Vessels navigating the strait follow a traffic separation scheme with inbound and outbound lanes, each two miles wide, separated by a two-mile buffer zone. Among the major nearby ports are Jebel Ali, Khor Fakkan and Fujairah (all UAE) and Bandar Abbas (Iran).

The strait is the world's most important oil chokepoint, facilitating the transit of approximately 20 to 25 percent of global seaborne oil trade and a significant portion of liquefied natural gas (LNG). Even a temporary delay can hike up global energy prices.

Bab al-Mandab Strait

The Bab al-Mandab Strait, also known as the “Gate of Tears,” connects the Red Sea to the Gulf of Aden. It is roughly 18 miles (about 29 kilometres) wide at its narrowest point between Yemen, Djibouti and Eritrea. The strait is divided by Perim Island, with the western channel serving as the primary deep-water route for large commercial vessels.

As the southern entrance to the Suez Canal, it is a mandatory corridor for trade between Europe and Asia. Alongside the Port of Aden in Yemen, the Port of Djibouti serves as a major maritime hub in the Horn of Africa, serving as trade and logistic hub for Africa.

Longer routes…

Shipping giant Maersk announced on Sunday that it would suspend all voyages from the Middle East and India to the Mediterranean via the Strait of Hormuz and also from the Middle East and India to the US East Coast via the Bab el-Mandeb strait and the Suez Canal. Instead, all vessels will go via the Cape of Good Hope, thus adding from 10 to 21 or more days to the journey.

While in stable times, a vessel’s “war risk” premium is a negligible fraction of its value — often as low as 0.01 percent, the math changes overnight during crises like the current one and premiums can jump to 0.50 percent of a vessels value or a 5,000 percent increase.

… and hidden costs

For example, for a modern very large crude carrier valued at 120 million US dollars, a single seven-day trip through the Persian Gulf can now cost the owner an extra 600,000 US dollars in insurance alone — a cost that is immediately passed to the consumer.

How this works: Insurance for a ship is split between hull and machinery, which is the standard, and war risk for conflict zones. When risks escalate, underwriters declare a “listed area,” allowing them to cancel existing annual policies and charge an additional premium for every single transit. In extreme cases, insurers do not just hike prices but withdraw coverage entirely for ships linked to specific nations, which are considered risky, thus effectively pushing those nations out of the trade lane.

But that is not the only hidden cost. There is also the airport tax to consider for cargo that stays past its “free time” - usually 48 to 72 hours. After that, it gets expensive: When airspaces close or flights are grounded due to conflict, cargo already delivered to the airport becomes “stranded.” Because the terminal is a high-security, high-demand space, authorities use aggressive daily fees (called demurrage) to prevent it from becoming a warehouse. The fees can be 100 US dollars per ton from Day 4 to 7 and get progressively higher the more time passes, 300 US dollars per ton after a week.

This means for high-value, time-sensitive exports (like pharmaceuticals, electronics or fast fashion), these fees can quickly exceed the value of the freight itself. Exporters are currently pleading for government waivers because they are being taxed for delays caused by war, which are entirely out of their control.

Working capital crunch for MSMEs

For manufacturers in India, Bangladesh, Vietnam and other South Asian garment producing countries, the crisis has also triggered a severe “working capital crunch.” As goods spend an additional two weeks at sea or more, capital is effectively frozen in transit. Industry insiders note that this delay strains the cash flow of micro, small and medium enterprises (MSMEs), which lack the deep pockets to weather prolonged payment cycles.

Ultimately, the volatility surrounding these two maritime arteries serves as a stark reminder that the global fashion industry is stitched together by much more than just thread and fabric; it is bound by the fragile stability of international waters.

As shipping lanes shift toward the Cape of Good Hope and “hidden taxes” like war risk premiums become the new baseline, the cost of doing business is being rewritten in real-time. For the garment sector — from the sprawling hubs of Southeast Asia to the high streets of Europe — the “Gate of Tears” and the Strait of Hormuz have become the ultimate stress tests for resilience, forcing a fundamental rethinking of how we move goods in an increasingly fractured world.