The Panama Canal Authority stated that some businesses recently spent up to 4 million USD to move ships through, due to the Strait of Hormuz remaining almost blockaded.

Typically, cargo ships pay a fixed fee to transit the Panama Canal, ranging from 300,000 to 400,000 USD depending on the vessel type, by booking in advance. However, companies without reservations can still pass by paying an additional fee through an auction for a slot. The early priority slot is awarded to the highest bidder, avoiding days of waiting offshore Panama City.

Cargo ship transiting the Panama Canal on 21/2/2025. Photo: AFP

Previously, businesses paid an additional 250,000 to 300,000 USD for earlier passage. However, in recent weeks, demand for unreserved transit slots has surged, as the blockade of the Strait of Hormuz forces cargo ships to reroute.

Consequently, the average additional fee has risen to about 425,000 USD, with the highest auction slots reaching 4 million USD, approximately ten times the usual cost. Panama Canal Administrator Ricaurte Vasquez cited an energy transporter as one of the highest bidding companies.

"It was a vessel carrying fuel to Europe, but they rerouted to Singapore because there was a fuel shortage there", he disclosed. Meanwhile, other oil companies have also paid additional fees exceeding 3 million USD to expedite passage through the canal amidst sharply rising oil prices.

Vasquez stated there is no vessel congestion at the canal. The increased costs are primarily due to last-minute route changes and urgent demand for faster transit amid chaotic trade. He emphasized that these fees are not the general market price. "They decide how high they are willing to bid", he said.

"With all the bombings, missiles, drones..., companies consider transiting the Panama Canal safer and less costly", commented Rodrigo Noriega, an analyst and lawyer in Panama City.

According to him, the additional fees for priority passage through the Panama Canal could increase further if the conflict persists and oil prices surge. Brent crude prices at one point exceeded 107 USD per barrel this week, a sharp rise compared to about 66 USD per barrel during the same period in 2025.

"No one truly anticipated the war's impact on global trade", he commented. Rodrigo Noriega also suggested that the government is "maximizing what it can earn from the Panama Canal".

While increasing revenue from these expedited transit slot auctions, Panama also faces negative impacts from geopolitical tensions. On 22/4, the country's Foreign Ministry accused Iran of "forcibly seizing" a Panama-flagged vessel belonging to MSC Francesca in the Strait of Hormuz.

Phien An (according to AP)