Experts say the giant cargo ship wedged across the Suez Canal is blocking shipments worth an estimated $9.5 billion per day from reaching their destinations. The shipments include food and oil and the delay in getting those goods to market will have ‘enormous’ impact on the world economy.
At least 150 ships are now stuck in the logjam caused by the 200,000-ton cargo ship Ever Given which ran aground in the narrow channel on Tuesday. Goods worth $29 billion are already held up.
The price of crude oil shot up 6 percent on Wednesday, reversing months of often-record falls caused by the coronavirus pandemic.
But the true cost of the disaster will be far higher as delays to vital goods cause losses at firms around the globe. Kate Harding, chief executive of trade data firm Coriolis Technologies, warned today that the risks to global trade are ‘absolutely enormous’.
If the canal cannot be quickly unblocked then shipping firms will have no choice but to route their vessels around the Cape of Good Hope at the tip of Africa – a route that adds 14 days and 5,000 nautical miles to the journey.
That could mean higher prices for goods shipped to Europe from Asia – including cars, construction materials, and coronavirus PPE – as shipping companies increase their charges to cover the cost of taking longer routes.
Meanwhile, the CEO of a team of Dutch experts brought in to help the rescue operation warned that the canal could be closed for ‘weeks’, with workers forced to unload cargo containers stacked some 100ft high on the ship’s deck if attempts to dig it out fail.
Peter Berdowski, CEO of Dutch company Boskalis, compared the ship to ‘an enormous beached whale’ as he warned workers might have to start offloading cargo in order to reduce its weight and get it floating again.
‘We can’t exclude it might take weeks, depending on the situation,’ he told Dutch media. ‘It’s an enormous weight on the sand. We might have to work with a combination of reducing the weight by removing containers, oil and water from the ship, tug boats and dredging of sand.’
He spoke as canal workers, who had paused work overnight during low tide, this morning restarted efforts to free the ship – which is about as long as the Empire State Building is tall – from where it has lodged diagonally across the waterway.
Excavators are trying to dig out the vessel’s dolphin-nose bow which has lodged in the eastern wall of the canal, while dredgers and tugboats try to shift its stern which is jammed against the western side.
(With input from the Daily Mail)