LONDON (ICIS)--Containership Ever Given remains grounded and blocking the Suez Canal, according to Leth Agencies, a company specialising in canal transits.
Tugboats and dredgers continue to try to refloat the vessel, but to no avail as of Thursday afternoon London time.
Traffic remains suspended with no new or projected changes, said Jacob Guldager, Leth’s business development director.
The Suez Canal is a key transit route for the LNG market and disruption could force tankers to take longer routes, potentially increasing gas prices due to delayed deliveries, and putting extra strain on the shipping market, raising charter rates, according to ICIS analysis.
It would particularly impact Qatari deliveries to European customers, including regular flows to the UK’s South Hook terminal, Belgium’s Zeebrugge, Italy’s Rovigo and Poland’s Swinoujscie.
Disruption would also delay cargoes from Russia’s Yamal LNG project trying to reach Asia. In the summer Yamal is able to send some cargoes east through the Arctic to reach Asia via the Northern Sea Route. But currently that is closed due to ice, so Yamal cargoes wishing to reach Asia generally head west to Europe, transfer from icebreakers to conventional ships in France, Belgium or the Netherlands, then head east to Asia via the Suez Canal.
According to ICIS LNG Edge ship-tracking data, there were 276 east to west laden LNG tanker deliveries in 2020 that used the Suez Canal. These were all from Qatar to Europe and Turkey.
There were 112 west to east laden LNG tanker deliveries in 2020 that used the Suez Canal, according to ICIS LNG Edge ship-tracking data. The biggest single producer using this route was Russia’s Yamal LNG project. Deliveries from Russia, France, Belgium and the Netherlands should all be counted as Yamal cargoes, with the majority of Yamal cargoes transferring ship-to-ship in Europe before completing their onward voyage.
The US is the second biggest country using the Suez Canal in this direction, with 34 cargoes taking the route in 2020.
Vessels forced to take alternative routes due to the disruption could see longer shipping times. The LNG Edge shipping calculator shows that a Qatari cargo travelling around South Africa to the UK would take around 27 days, compared with around 17 days for a route using the Suez Canal.
The main consumers for LNG in east Asia and Europe are now entering spring so heating demand is lower. This means there is greater resilience to any disruption that emerges.
If the Suez Canal had been disrupted in January this year, when demand was at its highest amid cold weather in Japan, it would have been much more serious.
At that time there was congestion on the Panama Canal slowing US cargo voyages to east Asia. Some US cargoes started taking a longer route to east Asia via the Suez Canal instead. This put a strain on shipping markets and LNG prices and charter rates soared in January as a result. If the Suez had been blocked too, prices would have gone even higher.