Escalating Middle East tensions prompt MoIT advisory

Escalating Middle East tensions prompt MoIT advisory

The ministry warned that global prices for fuel, crude oil and consumer goods could rise in the near future.

Oil extraction at the Bạch Hổ oil field, operated by Petrovietnam. — VNA/VNS Photo Huy Hùng

The Ministry of Industry and Trade (MoIT) has urged industry associations and enterprises to take proactive measures amid escalating tensions in the Middle East that threaten to disrupt transport routes and increase logistics costs.

The ministry warned that global prices for fuel, crude oil and consumer goods could rise in the near future, indirectly affecting Việt Nam’s production, import-export activities and trade ties with partners in the region.

Higher fuel prices are expected to drive up sea freight and air cargo rates, with direct implications for shipping routes to the Gulf. Transport through the Strait of Hormuz has reportedly been severely disrupted following airstrikes targeting Iran, raising concerns over supply chain stability.

In response, the ministry’s Agency of Foreign Trade has asked export-import and logistics associations to closely monitor developments and maintain regular communication with State management agencies to provide timely updates to their members.

Enterprises are advised to proactively adjust production plans and organise import-export and transport activities to avoid congestion and reduce potential losses linked to the conflict.

The agency also recommended diversifying supply sources and seeking alternative markets with similar demand structures to minimise the impact of possible disruptions to exports to Israel, Iran and other Middle Eastern destinations. Businesses were encouraged to develop long-term contingency plans to better withstand similar geopolitical shocks.

During contract negotiations, firms should pay close attention to logistics, delivery and insurance clauses. Transport agreements should clearly specify force majeure provisions, liability responsibilities and cost-sharing arrangements in the event of unforeseen risks. Adequate insurance coverage is essential to limit potential losses if incidents occur in import markets, the agency said.

The Agency of Foreign Trade further called on associations to coordinate with relevant ministries and sectors in analysing trade data and updating information on geopolitical developments, freight rates, surcharges and transport costs, enabling timely and coordinated response measures.

Enterprises were urged to establish preventive and adaptive strategies to mitigate risks in international trade and transport, while preparing rapid response mechanisms to safeguard supply chains.

At the same time, associations and businesses were encouraged to strengthen cooperation with MoIT units, including the Agency of Foreign Trade, the Việt Nam Trade Promotion Agency, the Department of Foreign Market Development and Việt Nam’s overseas trade offices, to identify alternative orders and explore potential substitute markets.

MoIT-affiliated units will continue monitoring developments in the Middle East and update enterprises accordingly, while enhancing cooperation with international organisations to improve the resilience of Vietnamese businesses against future geopolitical disruptions. 

Bizhub