Suez Canal stays blocked as efforts to dislodge ship longer than Eiffel Tower continue

CAIRO (BLOOMBERG) – Efforts to dislodge a giant container ship from the Suez Canal continued as rescue teams tried to get traffic moving again in one of the world’s most important waterways.

The Ever Given, a container ship longer than the Eiffel Tower is tall, ran aground in the southern part of the canal in Egypt on Tuesday (March 23) and is still stuck in position, said Mr Ahmed Mekawy, the deputy manager for the Suez Canal for Gulf Agency Company (GAC), a provider of port-agent services.

Traffic should resume “today or tomorrow”, he said on Wednesday (March 24).

Earlier on Wednesday, he said that the ship had been partially moved and was alongside the bank, however he later said this was incorrect. It is unclear whether that affected the timetable he gave for traffic to resume.

The Suez Canal Authority remained silent on the matter.

The incident is a reminder of how much international trade is channelled through so-called chokepoints – geographically constrained waterways that include the Strait of Hormuz and Panama Canal.

Dozens of vessels are already gridlocked at Suez and a lengthy halt could further stretch supply chains that have already been disrupted by the coronavirus pandemic.

“The Suez Canal blockage comes at a particularly unhelpful time,” said Mr Greg Knowler, European editor at JOC Group, which is part of IHS Markit.

“Even a two-day delay would further add to the supply chain disruption slowing the delivery of cargo to businesses across the United Kingdom and Europe.”

The 193km-long Suez Canal is among the most trafficked waterways in the world, used by tankers shipping crude from the Middle East to Europe and North America.

About 12 per cent of global trade and 8 per cent of liquefied natural gas pass through the canal, as do around one million barrels of oil each day.

The disruption comes at a time when oil prices were already volatile. Crude surged above US$70 a barrel earlier this month on Saudi production cuts, only to slump close to US$60 this week due to setbacks in Europe’s coronavirus vaccine program.

Brent crude rose 3 per cent to US$62.64 as at 1.31 pm in London (9.31pm Singapore time).

More on this topic

The Ever Given was grounded early on Tuesday amid poor visibility caused by a dust storm and wind speeds that reached 40 knots, resulting in a “loss of the ability to steer the ship”, according to the canal authority.

The vessel deviated “from its course due to suspected sudden strong wind”, Taiwan-based Evergreen Line, the time charterer of the vessel, said in an e-mailed response to questions. Japan’s Shoei Kisen Kaisha, which is among those listed as the ship’s owner, declined to comment.

About 42 vessels either in the northbound convoy or arriving to transit the canal in that direction were waiting for the Ever Given to be re-floated, Leth Agencies, one of the top providers of Suez Canal crossing services, said in a notice to clients. The company said it is sending a dredger to help free the ship.

About 64 vessels travelling southbound were also affected. GAC said 15 affected ships are waiting at anchorage.

Trucks wait to pass through the main gate of the El Ain El Sokhna port to Suez Canal on March 24, 2021. PHOTO: REUTERS

Navigation is possible along the old canal, the canal authority said. But the vessel is stuck at a point that cannot be bypassed so the old canal cannot help.

Ever Given was travelling from China to Rotterdam. The crew are safe and accounted for, and there have been no reports of injuries or pollution, according to the ship’s manager, Bernhard Schulte Shipmanagement.

The vessel is carrying cargo for logistics company Orient Overseas Container Line, according to Mr Mark Wong, a spokesman for OOCL.

At 400m in length, Ever Given was built in Japan about three years ago.

Shipping companies have been turning to mega-sized vessels to help improve economies of scale, while some key routes – including the Suez Canal – have been widened and deepened over the years to accommodate them.

More on this topic

Join ST’s Telegram channel here and get the latest breaking news delivered to you.

Source: Read Full Article