Yahoo Finance Giant ship stuck in Suez Canal poses ‘catastrophic’ problem
A skyscraper-sized container ship lodged between the Suez Canal in Egypt is holding up global shipping and causing another headache for oil.
The Ever Given, a container ship bound for Panama, has run aground in the man-made canal, forcing other ships carrying oil from Russia, the US and Oman to queue to enter and exit the canal.
Satellite pictures by Planet Labs Inc show the 400 metre long ship wedged across the narrow canal, despite two tugboats attempting to move it.
It’s unclear what caused the issue, although one official said the ship had been caught up in a gale-force sandstorm, which could have impacted the captain’s ability to navigate and control the vessel.
Shipping and logistics company GAC said the vessel had suffered a “blackout”.
The Suez Canal, which sits between continental Africa and Northern Egypt, provides passage for more than 10 per cent of all international maritime trade.
The 200,000-ton ship has now sparked concerns of a spike in oil prices amid warnings delays in shifting the ship add 15 days to other tankers’ voyages, with at least 100 huge ships now also blocked from entering the shipping channel.
The price of international benchmark Brent crude jumped 2.9 per cent on Wednesday local time to US$62.52 a barrel.
In an interview with the BBC, associate professor at Campbell University and maritime expert Sal Mercogliano warned the effect on world trade and vaccine supplies could be “catastrophic”.
“Because of Covid, you know how badly things have slowed down with moving goods, and now all of a sudden you add this and you’re going to have a delay getting goods to markets,” he said.
“We’re talking about vaccines, manufacturing goods, food, everything. It’s potential catastrophic delays.
“Ten per cent of the world’s trade goes through the Suez Canal and you average about 50 vessels a day and we’re in the second day of not being able to move any vessels.”
He said this is a historic first, with there never having been a grounding this size in the Suez Canal.
Suez Canal Authority chairman Admiral Osama has said rescue and tug units are continuing to try to dislodge the ship.
For now, shipping companies need to decide whether to wait, or reroute the vessels to navigate around the continent of Africa, which could add 12-14 days of travel.
