Sunil Kapoor: Tariffs and fees have created uncertainty but are also likely to encourage diversification in shipping

“The newly announced US tariffs have created a moment of shock and uncertainty,” Sunil Kapoor, the COO & Partner of ÖL Shipping Group tells CBN.

“From my years of experience, I know one thing for sure, markets and people don’t like uncertainty. But interestingly, the shipping industry often thrives in such situations,” Kapoor continues, having been asked to comment on the recent developments and their impact on the shipping sector.

“Just look at how it adapted during COVID-19. The shipping industry is resilient and will continue to grow and will adapt again to the new environment,” he explains.

Kapoor also references the proposed new $1 million US port fee on Chinese-built vessels, describing it as “a major concern, though it’s still unclear how it will play out. It may take 6–12 months before the real impact is felt.”

He goes on to note that, “Things will likely shift again—there will be negotiations, and maybe even revisions to the policy. In the end, US consumers and public opinion will likely influence the final shape of these tariffs. At a recent CMA conference, the consensus was that these tariffs may be softened but won’t vanish.”

The COO goes on to underline, “This is a wake-up call for the world to diversify shipbuilding beyond China. As costs rise due to tariffs, shipping lines will look for efficiencies, I am sure that AI will be playing an important role.”

He also notes that, “Right now, shipping is already being reshaped by the three D’s: Decarbonisation, Digitalisation and Deglobalisation. Add trade wars to the mix, and we may see more regional trade routes and countries seeking diversified trade partners.”

Kapoor concludes, “If there’s peace in the Mediterranean and the Russia-Ukraine war ends, regions like the Eastern Mediterranean could benefit. There are few countries and areas which need to be rebuild after the war and devastations. With smart investments in ports, logistics, and infrastructure, this area could become a key hub connecting regional markets.”