24 March 2021   Leave a comment

There is a traffic jam in the Suez Canal, caused by the grounding of a container ship, Ever Given (owned by Evergreen Marine of Taiwan and sailing under a Panamanian flag), the length of the Empire State building. The vessel ran aground due to high winds, and ships sailing both north and south have been forced to anchor in place. Shutting down the Suez Canal has a dramatic effect on the global economy, and CNN assesses the significance of the canal:

“The passage accounts for approximately 30% of container ship traffic globally each day, according to Reuters, with the alternative shipping route between Asia and Europe — navigating around the African cape — taking a week longer.

“Nearly 19,000 ships, or an average of 51.5 ships per day, with a net tonnage of 1.17 billion tonnes passed through the canal during 2020, according to the Suez Canal Authority.”

It is not clear how long it will take to refloat the ship, but the longer it takes, the more effect it will have on the world economy. Crude oil prices briefly surged when the news was announced, but have since returned to its earlier prices. But the stoppage highlights the vulnerability of oil prices to such chokepoints, raising fears about Iranian abilities to stop ship traffic through the Strait of Hormuz.

Although it is several years old, the data visualization firm Kiln and University College London’s Energy Institute produced a fascinating map of the movement of world commercial vessels in 2012 which can be accessed here.

Posted March 24, 2021 by vferraro1971 in World Politics

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