A dredge tries to free the container ship Ever Dado, one of the largest container ships in the world, after stranding on the Suez Canal, Egypt, on March 26, 2021.
Suez Canal Authority | Reuters
The companies are struggling to redirect transport ships to avoid congestion on the Suez Canal, including at least two U.S. ships transporting natural gas to Cheniere and Shell / BG Group, according to data provided by MarineTraffic and ClipperData.
At least ten tankers and container carriers are changing course as Ever Given, one of the largest container carriers in the world, remains stranded on the canal along Egypt, said MarineTraffic spokesman Georgios Hatzimanolis, CNBC in an interview.
“We expect that number to increase as the closing progresses,” said Hatzimanolis.
The 1,300-foot ship ran aground on Tuesday en route from Malaysia to the port of Rotterdam in the Netherlands. The stranded ship caused other vessels to retreat into the channel, holding about $ 400 million an hour in goods, according to the navigation newspaper Lloyd’s List. This has slowly increased in the past few days, after repeated efforts by Egypt to reflotate the 247,000 tonne container carrier have failed. Authorities are using eight large tugs and excavation equipment on the banks of the canal to remove sand around the stranded ship.
According to MarineTraffic, there are 97 vessels stuck at the top of the channel, 23 vessels waiting in the middle and 108 vessels at the bottom. The impasse extends across the Red Sea, through the Gulf of Aden, to the border of Yemen and Oman.
“From Asia to Europe, we are seeing ships being diverted in the Indian Ocean, just below the southern tip of Sri Lanka,” added Hatzimanolis. For ships bound for Europe from Asia, bypassing Africa instead of through the canal can add up to seven days of travel, he said.
The tanker Maran Gas Andros LNG left Ingleside, Texas, on March 19, loaded with Cheniere fuel and a cargo capacity of 170,000 cubic meters of liquefied natural gas. The Pan Americas LNG tanker, which carries Shell / BG fuel, left Sabine Pass on March 17 and can carry up to 174,000 cubic meters of liquefied natural gas. Matt Smith, director of commodity research at ClipperData, confirmed which companies were using the ships.
Both tankers changed course in the middle of the North Atlantic Ocean before swerving to bypass the Cape.
ClipperData also shows the Suezmax Marlin Santorini loaded with 700,000 barrels of Midland West Texas Intermediate crude bypassing the channel. Smith said the original route to Suez was “unusual fun”.
“The vast majority of US oil exports bypass the Suez Canal, going to Europe or around the Cape of Good Hope to Asia,” explained Smith. The Suezmax Marlin was at Magellan’s Seabrook terminal in Houston, Texas, on March 10, where it was topped up with 330,000 barrels of West Texas light oil before heading to Galveston, Texas, the next day.
The ship then left the United States declaring itself for Port Said in northeastern Egypt, but turned south on Thursday after passing through the Azores Islands near Portugal. “The ship has not yet updated its stated destination,” said Smith.
ClipperData shows the number of fully loaded tankers waiting in Port Said, as well as on the United States Gulf coast. On Friday afternoon, two other tankers and a Suezmax, the largest tanker that can sail the Suez Canal, transporting US vacuum diesel, were passing through Crete and preparing to anchor off the coast of Egypt.
Another ship, the HMM Rotterdam container carrier, left the canal shortly before entering the Strait of Gibraltar, changing course to bypass Africa.
Peter Sand, chief navigation analyst at BIMCO, said the diversion pattern is similar among other vessels.
“We are seeing not only container ships being redirected in both directions, but also LNG carriers and bulk carriers from the United States Gulf of Mexico,” said Sand. “The ships are making a sharp right turn in the middle of the Atlantic to head south towards Cabo da Boa Esperança to avoid congestion around Suez.”
Kevin Book, managing director of ClearView Energy Partners, says that while a long Suez outage introduces latency in the supply system, for liquefied natural gas, the length of the delay depends on where the ship started, where it is heading and for where he changed course on the journey.
“For US Gulf exporters, bypassing the horn only adds three days or less at sea to the port of Tokyo,” said Book. “For cargo from Doha to northwest Europe, this route can double in ten days of travel.”
The cargo that originated in the Gulf of Mexico and was stuck in the Mediterranean could face a diversion of ten days instead of three, he said.
At the time of publication, Cheniere and Shell / BG responded to CNBC’s request for comment.
The MSC Mediterranean Shipping Company said 11 of its ships were being redirected, 19 ships were anchored on both sides of the channel and two ships were being returned on Friday afternoon.
The blockade of the Suez Canal is one of the “biggest disruptions in global trade in recent years,” MSC senior vice president Caroline Becquart said by email on Saturday.
“We anticipate that the second quarter of 2021 will be more turbulent than the first three months, and perhaps even more challenging than it was at the end of last year,” she said. “Companies should expect the Suez blockade to lead to a restriction in transport and equipment capacity and, consequently, some deterioration in supply chain reliability problems in the coming months.”