Ocean spot freight rates increased by double digits this week as ocean carriers tack on more emergency fuel surcharges and begin setting up peak season surcharges, even as China intensifies regulatory scrutiny over carriers’ freight rate transparency and filing practices.

The sourcing superpower’s Ministry of Transport has levied fines and formal warnings against nine container shipping giants including Mediterranean Shipping Company (MSC), CMA CGM, Hapag-Lloyd, Ocean Network Express (ONE), Evergreen, Wan Hai Lines, SM Line, Emirates Shipping and TS Lines, as well as seven other ocean freight intermediaries.

Those warnings are not directly related to current Iran war-driven prices, as they are based on inspections that took place at major Chinese ports Ningbo, Guangzhou and Qingdao from August to November last year. But China sees a transparency issue in the way the rates are imposed, asserting that the carriers are violating filing regulations.

The transport ministry did not disclose the amount each carrier was fined. The department claims that there have been discrepancies between the freight rates shippers must pay, and the rates the carriers filed.

With the penalties, the transport ministry aims “to strengthen the regulation of international container liner shipping and non-vessel operating common carrier markets and enhance public oversight.” As such, the department is demanding that the companies “improve their freight rate filing systems, ensure accountability and earnestly fulfill their freight rate filing obligations.”

The ministry said provincial transportation authorities would intensify the regulatory scrutiny and inspections.

In March, in the early stages of the Iran war, the transport ministry had met with both MSC and Maersk regarding their shipping operations, with reports indicating the branch was concerned over the stability of trade after the carriers suspended service to the Middle East.

That same day, the country’s National Development and Reform Commission spoke with the ocean carrier giants, with reports suggesting the agency privately insisted they relinquish control over two Panama Canal-adjacent ports. Panama named both companies as operators of the ports after its Supreme Court ruled Hong Kong-based CK Hutchison’s contract to run them was unconstitutional.

Freight rates soar double-digits in one week

According to data from the Drewry World Container Index (WCI) released Thursday, container prices across eight major trade lanes surged 11.7 percent to $2,553 per 40-foot box. Higher freight rates on the trans-Pacific and Asia-to-Europe trade routes are continuing to bring upward pressure to the wider container market as the situation at the Strait of Hormuz forces carriers to rethink network planning and operational decisions worldwide.

Freight rates from Shanghai to New York increased 14 percent to $4,252 per 40-foot container, and those from Shanghai to Los Angeles rose 10 percent to $3,357.

According to Drewry’s Container Capacity Insight indicator, seven blank sailings have been announced on the trans-Pacific trade route for the next week, as carriers continue to manage capacity and tighten the market during what is typically a low-demand stretch ahead of the peak summer shipping season.

As for the Asia-to-Europe trade route, spot rates also increased this week due to the surcharges, along with capacity cuts announced by carriers in May. Rates from Shanghai to Genoa increased 20 percent to $3,701 per 40-foot container, and those from Shanghai to Rotterdam jumped 11 percent to $2,413 on average.

Drewry expects freight rates on the major trade lanes to increase further in the coming week.

The Shanghai Containerized Freight Index (SCFI), which measures weekly spot prices paid to ship containers from Shanghai across 15 different trade lanes, saw a similar global bump to Drewry, calculating a 9.5 percent increase Friday to $2,141 per 20-foot equivalent unit (TEU).

Container prices reflect the added fuel costs passed on by the carriers.

Maersk CEO Vincent Clerc said the ocean carrier is enduring $500 million in additional monthly costs due to the war, but noted that the company is making that money back in full by passing it on to customers through higher freight rates.

Similarly, Hapag-Lloyd has warned of escalating costs as the Hormuz remains largely constrained for container shipping. CEO Rolf Habben Jansen said the carrier is seeing $58 million to $70 million in extra weekly costs, which the company tries to pass on to consumers.

The spike in rates over the past week follows a period where container prices had plateaued over the month prior. Xeneta’s chief analyst, Peter Sand, said Thursday that the plateau would not last, as “volatility is never far away in container shipping.”

“One factor behind the short-term market plateau on the trans-Pacific is U.S. shippers delaying signing new long-term contracts due to the uncertainty caused by the Middle East crisis and the risk of locking in rates for the next 12 months at a higher level than necessary,” said Sand in a Thursday market update. “For every delayed contract, more containers must be moved on the spot market and carriers will charge a premium—but for shippers, the short-term pain is worth it if they ultimately secure lower long-term rates in the coming weeks.”