The Suez Canal enhanced efforts to free the giant jammed container ship and end the blockage that has sent the shipping rate for fuel tankers that jumped and disrupted the global supply chain for everything starting from baby clothes. The shipping rate for oil products tankers almost doubled after 400 meters (430 yards) ship ran aground in the vital trade water lane on Tuesday.
Free efforts may need weeks and become complicated with unstable weather conditions, threatening expensive delays for companies that have dealt with Coronavirus limitations. Shoei Kisenonce, the Japanese owner of the ship, denied the news report aimed at repelling him on Saturday night by saying efforts to take place remotely.
The Suez Canal Authority (SCA) said the effort to free the ship with the delay would continue after the dredging operation on the arc to eliminate 20,000 cubic meters of sand was finished. “In addition to the dredgers that are already on the site, a special suction drip now with a ship and will soon start working. This dredge can shift 2,000 cubic meters of material every hour,” said Bernhard Schulte Shipmanagement, the technical manager.
SCA said she would welcome the offer from the US to help. Turkey also said it could send a ship to the canal in the middle of Ankara’s recent encouragement to improve Egypt’s bond after years of hostility. The suspension of traffic through narrow channels that connects Europe and Asia has deepened the problem for the shipping line that has faced a disturbance related to Coronavirus in supplying retail goods to consumers.
According to a witness Reuters, about two dozen ships can be seen from Port Said beach on Friday morning. Oil prices rose 2% to more than $63 per barrel on Friday because more than 30 oil tankers had been waiting on both sides of the canal since Tuesday, data delivery on graphic shows. However, the delay comes when seasonal demand is low for crude oil and liquefied natural gas (LNG), which is likely to reduce prices, analysts said.
KPLER data intelligence company said ten crude oil tankers were waiting to enter the canal. About 4 million barrels, mostly mixed CPC Kazakh and some Russian Urals, are waiting together with a tanker carrying Libya, Azeri, and several North Sea crudes for Asian refinement, traders said. The Egyptian Sumed Pipe operator quickly approached rude traders to see if they wanted to order space in the system but so far, traders preferred to wait to avoid high additional costs.
If the blockage lasts for two weeks, about one million tons of LNG can be postponed for shipping to Europe, according to Rystad Energy, which can more than double in the worst-case scenario throughout the month. Some European buyers worried about the delay in shipping Qatar LNG can consider buying in the spot market. Meanwhile, oil traders told Reuters they adopted the waiting approach and saw to see whether higher tide on Sunday would help.
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