How will the US tariff spree affect the shipping market?

The US has unveiled a new wave of tariffs aimed at reshaping global trade flows. A standard 10% duty will apply to all imports, with steeper rates targeting countries with the most significant trade imbalances – including China at 34%, the EU at 20%, and Japan at 24%. While the initial reaction points to pressure on container shipping and car carriers, the broader shipping market remains relatively sheltered for now. However, any escalation in retaliatory measures could shift the outlook across more segments.

Tankers: not directly impacted, positive ripple effects
Oil and refined products have been exempted from the new tariff regime, insulating tanker trades from direct impact. In fact, tanker markets have seen early benefits, as shifting trade flows – particularly from Canada and Mexico – are boosting tonne-miles, with suppliers looking beyond traditional US pipeline routes to seaborne exports towards Europe and Asia.

While a broader concern is that a prolonged trade war could dampen global economic activity and, by extension, oil demand, industry voices remain cautiously optimistic. Harry Vafias, principal of several US-listed shipping companies, told TradeWinds: “Tariffs will be negative in the beginning but positive afterwards.”

Car carriers: Tariffs weigh on seaborne vehicle trade
The introduction of a 25% tariff on all foreign-built automobiles, effective immediately, presents a clear headwind for the car carrier market. A similar 25% tariff on auto parts will follow on May 3rd. Although Chinese-built vehicles make up a minor share of US imports overall, more than 4 million vehicles were imported by sea to the US in 2024.

These new trade barriers might pressure volumes in the car carrier segment. However, it’s worth noting that demand patterns could shift over time as manufacturers and consumers adjust to the new trade landscape.

Gas carriers: Limited direct exposure, but retaliation risk looms
The gas shipping segments, particularly LNG and LPG, are not directly targeted by the new US tariffs. However, China’s immediate retaliatory announcement, including new tariffs on US LPG imports, has introduced uncertainty. Early market reactions have included lower freight offers and a narrowing arbitrage window.
As one of the largest global exporters of LNG and LPG, the US market remains sensitive to further retaliatory moves, which could influence trading patterns and freight demand in the near term.