Page 13 - EurOil Week 13 2021

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Giant container ship blocks Suez

Canal, disrupts LNG deliveries

EGYPT SHIPPING through the Suez Canal was blocked Sea and headed to the Suez Canal, en route to
when one of the world’s largest container ships Europe. These cargoes have a combined capacity
The Suez Canel is one ran aground after being blown off course by a of more than 1mn cubic metres of LNG, or close
of the world’s busiest sandstorm at the southernmost stretch of the to 500 tonnes, according to Rystad.
trade routes. canal close to Suez City. Egypt’s Suez Canal Authority mobilised its
Every day about 50 vessels traverse the water- full resources, with eight tugboats pulling the
way, a key foreign currency earner for the Egyp- Panama-flagged Ever Given, owned by Tai-
tian economy, bringing in $5.6bn in revenues wan-based Evergreen Marine, in an effort to
for the treasury in 2020. The waterway is the refloat the vessel. At press time, the vessel was
shortest maritime trade route between Europe partially floated, but it remained firmly anchored
and Asia through which passes 12% of global to the shore, sitting astride the canal in a hori-
merchandise commerce. Total oil flows through zontal position blocking traffic through the vital
the canal and its associated Sumed pipeline sys- waterway.
tem accounted for almost 10% of global seaborne Refloatation efforts were initially expected to
traded petroleum in 2018. In the same year, take two days, with a backlog of ships building on
about 8% of global LNG trade passed through both entry points to the canal. However, a salvage
the maritime artery. company working on the operation warned on
“The Suez Canal is one the world’s busiest March 25 that releasing the vessel could take days
trade routes, and this blockage is having great or even weeks.
implications on global trade, including LNG, “Even if the route is liberated within one
as shipments to Europe from one of the world’s week, there is a large queue of cargoes lining up
largest LNG producers – Qatar – essentially all to cross the Canal, so the return to normal flow
pass through there,” commented Rystad Energy’s will take some time,” Torres Diaz said. “And the
head of gas and power markets, Carlos Torres longer it takes to liberate the route, the longer the
Diaz, in a note. “The canal is the main route for queue of vessels.”
LNG cargoes heading from the Middle East to He noted that European gas demand had
Europe and for some cargoes heading from the started to wane with warmer temperatures, but
Mediterranean to Asia. During 2020, close to 260 added that the continent needs continuous sup-
LNG cargoes were sent from Qatar to Europe via plies of LNG in order to replenish low levels in
the Suez Canal, or an average of five per week.” underground storage.
Rystad’s data show that there are currently In response to the emergency, the Suez Canal
three loaded LNG cargoes in the Suez Gulf Authority issued a statement saying that once
waiting to cross to the Mediterranean that were navigation resumes through the canal, opera-
originally expected to arrive at European regasi- tions will take place around the clock. Usually the
fication terminals during the first week of April. canal is closed for navigation during night time
At least another two are located in the Arabian for security reasons. ™

Week 13 01•April•2021 www. NEWSBASE .com P13