Could the Arctic rewrite global trade?

Summary

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Business Daily (BBC World Service)

Episode: "Could the Arctic Rewrite Global Trade?"

Date: March 24, 2026
Host: Adrienne Murray

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Episode Overview

This episode delves into the rapidly evolving world of Arctic shipping as climate change opens up new maritime routes at the top of the globe. The discussion explores the potential for the Arctic to fundamentally reshape global trade patterns by offering shorter shipping distances between Europe and Asia. The episode addresses the economic opportunities, geopolitical tensions, environmental risks, and challenges facing operators, with perspectives from shipping executives, policymakers, Arctic researchers, and indigenous representatives.

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Key Themes and Discussion Points

1. Changing Arctic Ice and Emergence of New Shipping Routes

• Climate change is accelerating the shrinkage of Arctic sea ice, making seasonal navigation in previously inaccessible waters increasingly viable ([05:24]).
• Adam Lasmopov (Arctic Researcher):
  “The Arctic is warming up four times, five times as fast as everywhere else.” ([05:24])

Major Arctic Shipping Routes ([05:54]–[06:20])

• Northern Sea Route (NSR): Along the Russian Arctic coast; currently the most developed.
• Northwest Passage: Through Canadian Arctic Archipelago; less developed, rarely used.
• Transpolar Route: Over the North Pole; largely theoretical for now.

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2. Early Arctic Trade Voyages and New Commercial Activity

• In October 2025, a container ship (Istanbul Bridge, Sea Legend Line) sailed the Arctic route from China to Europe in just 20 days, a week less than the established southern route ([02:07]).
• Rising instability in the Suez Canal and Middle East, such as in the Gulf of Aden and Strait of Hormuz, is prompting shippers to explore alternatives ([02:58]).

Andy Thorn (CEO, Kestrel Shipping Agent):

• “Coming straight across the North, we’re going to reduce the transit times and therefore reduce costs immediately.” ([03:29])
• Highlights problems and delays caused by diversions around southern Africa during Suez or Middle East crises ([03:10]).

Planned Developments

• Chinese and South Korean companies are preparing regular or trial services through Arctic routes (e.g., “China Europe Arctic Express”) ([03:19], [03:40]).

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3. Geopolitical Interests and Superpower Competition

• Russia:
  Sees the NSR as vital for exporting oil, gas, and other resources. President Putin’s ambition is to turn the route into a major shipping artery ([15:03]).
• China:
  Brands itself as a “near Arctic nation.” Collaborates with Russia via the "Polar Silk Road," seeking strategic and economic leverage across Eurasia ([15:42], [16:09]).
• United States:
  Increasing focus on security and strategic value of the Arctic, with high-level officials (Treasury Secretary Scott Besant and Commerce Secretary Howard Lutnick) stressing the need to “protect” emerging shipping lanes ([04:31], [04:43]).

Scott Besant (U.S. Treasury Secretary):

• “As there are more trade routes that move near Greenland, Greenland becomes more and more valuable.” ([04:34])

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4. Current Status and Realities of Arctic Shipping

• Seasonal Navigation:
  Most routes navigable only from June to September/October, unless ships are ice-class reinforced or accompanied by icebreakers ([07:17]).
• Traffic Levels:
  • Only 670 vessel transits through the Bering Strait in 2025, with about 100 full NSR voyages ([08:03]).
  • Northwest Passage remains minimally used due to ice, lack of infrastructure ([09:09], [09:29]).

Daniel Richards (Director, Maritime Strategies International):

• “It’s still a very, very tiny proportion of global trade and there is reluctance on the part of the major shipping companies to use it more.” ([01:59])
• “The ships are much smaller… it's still cheaper to go via longer routes via Suez or the Cape of Good Hope.” ([17:20])

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5. Operator’s Perspectives: Challenges and Caution

Mazboy Petersen (CEO, Pangaea Logistics Solutions):

• Describes challenges like variable ice, short operating windows, and extreme conditions ([12:36]–[13:46]).
• Emphasizes specialized ships and skilled crews.
• Reflects on the 2013 Northwest Passage transit, cautioning against assuming that the Arctic will easily replace the Suez Canal:
  • “To think that the Northern Sea Route, for instance, could be turned into some sort of alternative to the Suez Canal is a bit naive in my mind.” ([13:58])

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6. Environmental Risks and Indigenous Concerns

• Arctic communities depend on marine resources for their economy and culture ([18:39]).
• Indigenous leaders highlight the growing dangers of noise pollution, black carbon emissions, and water contamination from increased shipping traffic ([19:11], [19:57]).

Sarah Alsfie (Inuit Circumpolar Council):

• “We very much depend on the resources of the sea… it’s still the marine resources that are the main income for us, but also in our traditional lifestyles.” ([18:39])
• “For us it’s extremely important to participate closely in regulating the shipping of the Arctic… there is an increase of activity stemming from outside of the Arctic and that’s something that we are concerned about.” ([19:11])

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7. The Reluctance of Major Industry Players

• The top ten global container shipping companies, including MSC, are holding back from using Arctic routes due to:
  • Geopolitical risk (Russian territorial waters)
  • Environmental sensitivity
  • Economies of scale—smaller ships mean lower margins ([17:04]–[17:20])

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Notable Quotes & Memorable Moments

• Andy Thorn:
  “Coming straight across the North, we're going to reduce the transit times and therefore reduce costs immediately.” ([03:29])
• Adam Lasmopov:
  “We know that sometime by the mid century we will experience the first ice free event, probably a day during the summer when there is no ice in the Arctic Ocean at all.” ([05:38])
• Daniel Richards:
  “It's mostly a question of less sailing distance... your distance is going to be anything from 25 to 40% shorter and that should translate to lower fuel consumption.” ([07:42])
• Mazboy Petersen:
  “To think that the Northern Sea Route, for instance, could be turned into some sort of alternative to the Suez Canal is a bit naive in my mind.” ([13:58])
• Sarah Alsfie:
  “How can we make ships less noisy? How can we make them emit less black carbon? How can we ensure that gray water that has been taken into the ship somewhere else in the world will not be poured out in the Arctic waters?” ([19:11])

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Timestamps for Key Segments

• Introduction to Arctic Shipping: [01:18]
• Recent Arctic voyages and commercial interest: [02:07] – [03:19]
• Geopolitical interests (Russia, China, US): [03:40] – [05:38]
• Climate change and navigability: [05:24] – [07:17]
• Description and challenges of routes: [07:41] – [09:29]
• On-the-ground operator perspective: [12:11] – [14:38]
• Russian and Chinese strategies: [15:03] – [16:38]
• Shipping industry’s reluctance: [17:04] – [17:45]
• Indigenous/Environmental concerns: [18:11] – [19:57]

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Conclusion

The episode underscores the transformative potential, but persistent uncertainties, of Arctic shipping routes in remapping global trade. While climate change and geopolitics are opening new possibilities, real-world challenges—seasonal navigation, infrastructure needs, environmental threats, and economic calculations—suggest that any "rewriting" of global shipping will be slow and uneven. Indigenous communities and environmental risks remain central concerns as new players contemplate following in the icy wake of the pioneers.

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Transcript

[Adam Lasmopov]

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[Adrienne Murray]

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[Adrienne Murray]

Hello and welcome to Business Daily on the BBC World Service Hub. Hi, I'm Adrienne Murray and today we're looking at shipping in the Arctic. As Polish sea ice retreats, potential new trade routes are beginning to emerge at the top of the world.

[Andy Thorn]

Coming straight across the north, we're going to reduce the transit tunnels and therefore reduce costs.

[Adrienne Murray]

We'll examine the players with big ambitions to develop these shipping shortcuts between Europe and Asia.

[Adam Lasmopov]

Putin and Xi Jinping, they got together and announced that the Polar Silk Road was a new project.

[Adrienne Murray]

So might the global trade map be redrawn or do the risks outweigh the rewards?

[Daniel Richards]

It's still a very, very tiny proportion of global trade and there is reluctance on the part of the major shipping companies to use it more.

[Adrienne Murray]

That's all coming up on business daily. Docking in the British port of Felixstowe last October was a ship called the Istanbul Bridge. It was carrying around 4,000 containers and had sailed from Ningbo in China. What was extraordinary was the unconventional route it took to Europe, an almost 8,000 nautical mile journey through the Arctic waters above Russia. Operated by the Chinese controlled firm Sea Legend Line, the voyage took just 20 days, a whole week less than sailing around Asia and through the Middle East. With recent troubles in the Gulf of Aden and now the Strait of Hormuz, some sea promise an alternative route.

[Andy Thorn]

We have always had problems going through the Suez Canal.

[Adrienne Murray]

Andy Thorn is CEO of Kestrel, a shipping agent which handles Sea Legends vessels when they call into UK Ports.

[Andy Thorn]

Every time there's a flare up, the ships are then forced to go round the Cape in South Africa, which causes longer transit times in more expensive and delays cargo.

[Adrienne Murray]

From this summer, the container line plans to run a regular cargo service dubbed the China Europe Arctic Express.

[Andy Thorn]

Coming straight across the North. We're going to reduce the transit times and therefore reduce costs immediately. The impact on getting goods which are needed urgently out of Asia into Europe

[Adrienne Murray]

is significant and it's not alone. South Korean officials have also touted plans for sea trials this summer. Summer using the same route. So will this usher in a new commercial shipping corridor linking Asia with Europe? This comes as geopolitical interests in the Arctic region are also heating up. And these emerging shipping routes are drawing attention from the world's superpowers, including Russia, China and the United States. Though President Trump covets Greenland for US national security, several of his White House inner circle also note the strategic importance of Arctic shipping lanes. Here's U.S. treasury Secretary Scott Besant at the World Economic Forum earlier this year.

[Adam Lasmopov]

As there are more trade routes that

[Daniel Richards]

move near Greenland, Greenland becomes more and more valuable.

[Adrienne Murray]

And U.S. commerce Secretary Howard Lutnick speaking to Fox News.

[Howard Lutnick]

As the Arctic opens, as it opens,

[Daniel Richards]

what do you think is going to happen?

[Howard Lutnick]

Right.

[Daniel Richards]

We need those shipping lanes and you

[Howard Lutnick]

need to be protected.

[Adrienne Murray]

Much of this focus is security driven, but it's also economic. So what are these routes exactly and who's using them? Well, before we go further, I want you to picture a globe and look down at the top. Here in the center is the North Pole surrounded by the Arctic Ocean. And that's covered by a vast expanse of frozen sea ice spanning more than 4 1/2 million kilometers. However, it's shrinking rapidly due to climate change.

[Adam Lasmopov]

The Arctic is warming up four times, five times as fast as everywhere else.

[Adrienne Murray]

Adam Lasmopov is an Arctic researcher and Russia China specialist from the Friedhof Nansen Institute, Norway.

[Adam Lasmopov]

We know that sometime by the mid century we will experience the first ice free event, probably a day during the summer when there is no ice in the Arctic Ocean at all.

[Adrienne Murray]

In the summer, stretches of the sea are already opening up around the north coasts of Russia and Canada.

[Adam Lasmopov]

So there are three passages. The first one is the Northern Sea Route, which the Soviet Union started developing a long time ago, already in the 20s and 30s. Then there is the Northwest Passage, which is which explorers have been dreaming of for a long time. So this thought that you can go around the North American continent and at

[Adrienne Murray]

least in theory, there's a third route over the North Pole.

[Adam Lasmopov]

There is the Transpolar route, which conveniently bypasses both Canadian and Russian controlled areas. And that is not a passage that will be used commercially anytime soon. Even if we experience the ice free event within our lifetimes, there will still be ice in the Arctic during the winter period.

[Adrienne Murray]

So just how navigable are these routes? And are more ships now voyaging north?

[Daniel Richards]

When people are talking about Arctic shipping, it's this northern sea route above Russia that they're generally referring to.

[Adrienne Murray]

Daniel Richards is a director at London based consultancy Management Maritime Strategies International.

[Daniel Richards]

It's here where there's been the most voyages and where there's the most ambition to develop this as a future shipping line.

[Adrienne Murray]

This is at the top of the world. It's clogged with sea ice for much of the year. How navigable is this route today?

[Daniel Richards]

So you tend to have a season spanning roughly from around June to the end of September, early October. Outside of that window, unless the vessels have advanced ice class classification or hull reinforcements or they're accompanied by an icebreaker, it is less navigable over that kind of summer to early autumn window. Now though, ships without that technology can sail more or less unhindered.

[Adrienne Murray]

What's the benefit of doing this?

[Daniel Richards]

It's mostly a question of less sailing distance, and especially if you're coming from Japan, from Korea or the more northerly Chinese ports. So compared to going via the Suez Canal by the Cape of Good Hope, your distance is going to be anything from 25 to 40% shorter and that should translate to lower fuel consumption.

[Adrienne Murray]

Arctic shipping traffic has grown significantly over the last decade, but the volume of trade compared to the world's major shipping corridors remains very small. Looking at the Bering Strait, that narrow gap between Alaska and the far eastern tip of Russia, There were just 670 transits by vessels of all kinds last year, and just over 100 voyages were undertaken for the first full length of the northern sea route.

[Daniel Richards]

You can break down the users into three categories. So the first is simply Russian coastal shipping. So serving communities, the ports, the industries along the Arctic coast. The second is the shipping of hydrocarbons. So Russia has extensive unused natural gas and crude oil reserves. What the shrinkage of the Arctic sea ice has meant is that these hydrocarbons, they are now being shipped in greater volumes and for the moment, this is kind of the main use. The third category is, and here you're looking at container ships, this has increased in use in the past several years, but it's still a very, very tiny proportion of global trade.

[Adrienne Murray]

If we turn to the northwest Passage, which runs north of Alaska and Canada, then down past Greenland into the Atlantic. There were only a handful of transits recorded by cargo ships last year.

[Daniel Richards]

For the moment, that really isn't very well utilised, and there aren't really many plans to develop that as a commercial shipping lane for the time being.

[Adrienne Murray]

What are the main choke points or hurdles there?

[Daniel Richards]

So there's some greater difficulty in terms of navigation. There's also just less infrastructure. So Russia has built up and maintains a pretty extensive fleet of nuclear icebreakers. US and Canada between them don't have those now. The US signed a deal with Finland to develop some more of these ships. So it's possible if the level of sea ice shrinkage increases, Northwest Passage may become more viable.

[Adrienne Murray]

Daniel Richards, there's you're listening to Business Daily on the BBC World Service.

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[Adrienne Murray]

I'm Adrian Murray and today we're looking at Arctic Shipping. Famous Norwegian explorer Roald Amundsen was the first to complete the Northwest Passage linking the North Atlantic and Pacific Oceans back in 1906. Yet for another century this route through the Canadian Arctic remained largely impassable for Cargo ships. In 2013, the first ever commercial transit was completed by Danish firm Nordic Bulk Carriers, now Pangaea Logistics Solutions. It's one of the few Arctic shipping specialists. And joining me down the line, CEO Mazboy Petersen told me about the realities of operating so far north.

[Mazboy Petersen]

A big part of our business is carrying iron ore from Canadian Arctic into the steel makers in Europe. We, we have also done other trades where we carry rare earth type minerals. These are the kind of things that I think are more commercially sustainable and I think also generates more value for those countries and those communities. Rather than thinking of the Arctic as some sort of shortcut.

[Adrienne Murray]

And what are those conditions like in those summer months that you are in the Arctic region?

[Mazboy Petersen]

Our operating window in the Arctic typically stretches from, say, late July into October, early November. We are dealing with very changing conditions over the summer from a lot of floating ice in the beginning of the season. How do you manage the risk of icebergs through the height of the summer where there's very little ice, and towards the end of the season where we will start to see the cold temperatures and the sort of fast ice freezing up again, there's very little activity during the winter months. The conditions there are very, very harsh and much more difficult.

[Adrienne Murray]

And these are specialist vessels. What sort of capabilities do they have that make them different to other types of cargo ship that we. We typically see?

[Mazboy Petersen]

Our fleet of Ice class bulk carriers are designed to operate in the ice conditions of the Arctic summer. Right. And they are built to certain higher standards in terms of reinforced hull, it has a bigger engine in order to be able to sail through the ice. It is a very different part of the world. For instance, in certain parts of the Arctic, you simply don't have the same degree of navigational charts. It's a case of having specialized ships, but having crew with a very unique skill set.

[Adrienne Murray]

You were operating under Nordic Bulk carriers when it was the first ever sailing of a large cargo ship through the Northwest Passage. Can you just recap what it took to pull off those journeys?

[Mazboy Petersen]

First of all, we had the ships and we had the people on board the ships who do this safely and efficiently. But it took a lot of work working with our customer, working with our insurance companies, Canadian Coast Guard. We were very clear that we had a very defined window of when we would be comfortable doing this. And on that specific voyage, we didn't encounter any ice at all. We had a very short escort from a Canadian icebreaker, guide the ship through it Basically open water, right. I think people underestimate just how difficult it is to operate in those regions. So to think that the Northern Sea Route, for instance, could be turned into some sort of alternative to the Suez Canal is a bit naive in my mind.

[Adrienne Murray]

That was Mazboy Peterson from Arctic shipping company Pangea. So far, most shipping activity is taking place in Russian waters. Stretching some 24,000 kilometers. The country has the longest coastline around the Arctic Sea. And President Putin has long held ambitions to develop the Northern Sea Route. And Zadim Lesmov explains.

[Adam Lasmopov]

So for Russia, the Northern Sea Route is a vital core interest. There are Russian resource projects and Russian resource shipping, so Russian oil, Russian gas. One of the goals that by 2024, Russia will increase the overall cargo on the Northern sea route to 80 million tons. This has not come to pass. Last year in 2025, the actual cargo was only 37 million tons, which, which is still a significant increase. So this is the highest traffic has ever been on the Northern Sea Route.

[Adrienne Murray]

Meanwhile, China, which calls itself a near Arctic nation, wants to advance east west trade.

[Adam Lasmopov]

China in particular has been interested in using the Northern Sea Route as a potential new economic corridor that would stretch from China to Europe. So Russia wanted Chinese investment in the infrastructure along the Northern Sea Route, while China seemingly wanted access to. In 2017, Putin and Xi Jinping, they got together and announced that the Polar Silk Road was a new project. Chinese companies used the Northern Sea Route

[Adrienne Murray]

at that time, but the traffic hasn't grown as much as expected.

[Adam Lasmopov]

After Russia's full scale invasion of Ukraine in 2022, the Chinese state owned enterprise Cosco stopped using the Northern Sea Route. Instead, there are smaller companies that operate on the. On the route which are not directly associated with the Chinese state. So it's not the giant Cosco, which does a lot of business everywhere in the world and cannot afford to be struck by secondary sanctions.

[Adrienne Murray]

Edm, Lasmapov there. Well, as some firms step up plans to use this new Arctic shipping lane that stands in sharp contrast to the world's largest container shipping company, msc, whose boss made it clear last month that the firm has no plans to send vessels through Arctic waters anytime soon. And it's a position echoed by other big players.

[Daniel Richards]

There is reluctance on the part of the major shipping companies to use it more. The top 10 container shipping companies for the moment, none of those seem likely to use this route at scale.

[Adrienne Murray]

And what are the risks that they see? Is this a geopolitical issue or is it economic viability? Doesn't really stack up yet.

[Daniel Richards]

So the Risks are partly geopolitical. If you're sailing along the Northern Sea route, you are sailing entirely through Russian territorial waters. It's an ecologically sensitive area. There's also an economics aspect. The ships are much smaller. So although you are reducing your voyage times, if you spread it over the number of cargo units you're carrying, it's still cheaper to go via longer routes via Suez or the Cape Code Hope.

[Adrienne Murray]

Do you think we'll see more more commercial shipping activity in the Arctic going forward?

[Daniel Richards]

You would like to see an increase in next year's sailing window compared to this one's and that will continue to grow. I think there will be more Chinese based operators. You'd also like to see in the other direction increased volumes of Russian commodity and hydrocarbon exports, but as a alternative to the major east west shipping lanes, that's probably a much more distant prospect.

[Adrienne Murray]

Daniel Richards from Maritime Strategies International. There's those. Environmental concerns about growing shipping traffic are also shared by local communities living in the Arctic. From Greenland's capital Nuuk, I spoke to Sarah Alsfie, who chairs the Inuit Circumpolar Council, an organization representing indigenous peoples from across Greenland, Canada, Alaska and Russian Chukotka.

[Sarah Alsfie]

We are a marine people. We always live close to the water. We very much depend on the resources of the sea and today's galaxy. Nunnad, Greenland. The fisheries make up 95% of the exports. So it's still the marine resources that are the main income for us, but also in our traditional lifestyles. Hunting sea mammals and living from the resources of the sea is still very key to our identity and culture.

[Adrienne Murray]

Her organization are seeking stronger regulations and a bigger say on regional shipping policy.

[Sarah Alsfie]

So for us it's extremely important to participate closely in regulating the shipping of the Arctic. And I have to say we are also ship owners when we have big companies doing shipping and fishing. Of course we are also taking part in this shipping in the Arctic. But there is an increase of activity stemming from outside of the Arctic and that's something that we are concerned about. For example, underwater radiated noise is a big issue. How can we make ships less noisy? How can we make them emit less black carbon? How can we ensure that gray water that has been taken into the ship somewhere else in the world will not be poured out in the Arctic waters? There are these kinds of things where we need further regulation.

[Adrienne Murray]

Well, that's all we've got time for for this episode of Business Daily on the BBC World Service with me, Adrienne Murray. Thank you for listening.

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