"Paying a $4 Million Premium to Skip the Line: Panama Canal Fast-Track Fees Soar as Hormuz Shuts Down"

As the Strait of Hormuz in the Persian Gulf has been effectively paralyzed due to the aftermath of the Iran war, demand for maritime transportation via the Panama Canal is surging. As waiting times at the canal increase, there has also been a rise in cases where ships pay a premium, in addition to the regular toll, to advance their place in line for passage.

On April 17 (local time), Bloomberg reported, "Due to the Iran war, the waiting time to enter the Panama Canal has reached 3.5 days, and some vessels have paid an additional $4 million (5.918 billion won) to move up in the queue."

Panama Canal. Panama Canal Authority

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This situation is analyzed to be the result of cargo traffic shifting to the Panama Canal after the Strait of Hormuz was effectively blocked. According to the Panama Canal Authority, this is the longest waiting time since the number of transiting vessels was significantly restricted during the 2023-2024 drought.

Recently, it was reported that a tanker transporting liquefied petroleum gas (LPG) paid about $4 million to expedite its passage through the canal. This is nearly four times higher than the rate at the beginning of the Iran conflict in early March, when the cost was less than $1 million (1.4795 billion won).

This fee is separate from the standard canal transit toll. Depending on the vessel and cargo, the cost of passage can amount to several hundred thousand dollars.

The canal authority explained that ships with reservations can reduce waiting times if they arrive at the designated time. However, it noted that most ships have already made reservations.

According to the canal authority, the additional premium is not a fixed official fee but is determined through auction. The amount varies depending on factors such as the urgency of the shipping company, commercial priority, global supply and demand, freight rates, and fuel costs.

The market views the recent increase in U.S. export volumes as another factor driving up demand for Panama Canal passage.

According to Bloomberg's data, the 3.5-day waiting time is the median for all commercial vessels moving in both directions over the past seven days, regardless of reservation status.

The industry expects that competition for canal transit will continue for the time being, keeping the additional premium at a high level. Bloomberg stated, "In the roughly seven weeks since the outbreak of the Iran war, Asian countries highly dependent on Persian Gulf energy are increasingly relying on U.S. supplies as an alternative source. In particular, LPG shortages, which are used as household fuel, are becoming pronounced in countries such as India."

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