Suez Canal: Biden Offers Help As Some Ships Head To Cape Of Good Hope | Suez Canal

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Joe Biden said the United States is considering what it can do to help free the 400-meter container ship Ever Given from its position blocking the Suez Canal as the trade route crisis continues into a fifth day .

“We have equipment and capabilities that most countries don’t have. And we see what help we can be, ”the US president said in Delaware on Friday. His comments came after a US official said the Navy was ready to send a team of dredging experts to the canal, but was awaiting approval from local authorities.

Meanwhile, as the last effort to dislodge the vessel with tugs was suspended on Friday evening, shipping companies began to reroute cargo elsewhere to avoid aggravating the huge blockage that has built up at either end. of the crucial commercial artery.

Maersk said 22 of his ships have been affected so far and that he has so far diverted two of his ships around the Cape of Good Hope at the southern tip of Africa.

A spokesperson said: “We are closely monitoring the development of the affected vessel’s float operations to better assess the measures to be taken to mitigate the delay of the affected cargo. The longer it takes to get the ship afloat, the greater the risk of serious bottlenecks in the ports of northern Europe, and the more difficult it will be to clean up. “

The ship’s Japanese owner Shoei Kisen Kaisha said he aimed to free the ship on Saturday afternoon UK time but couldn’t guarantee the effort would be over by then.

Tanker shipping rates have nearly doubled since the ship ran aground, and efforts to free the giant ship can take weeks and be complicated by unstable weather conditions, threatening costly delays for businesses already facing the storms. Covid-19 restrictions.

A Dutch rescue team had confirmed that two more tugs would arrive on Sunday to help dislodge the vessel, said Bernhard Schulte Shipmanagement (BSM), technical director of Ever Given.

Previously, the Suez Canal Authority (SCA) said efforts to free the tugboat had resumed after the completion of dredging operations at its bow to remove 20,000 cubic meters of sand.

“Towing operations require the availability of a number of supporting factors, including wind direction and tides, making it a complex technical process,” the authority said.

The SCA has welcomed an offer of US aid. Turkey has also said it could send a ship to the canal, amid an Ankara push to reestablish ties with Egypt after years of animosity.

The suspension of traffic along the canal connecting Europe and Asia has exacerbated the problems for shipping companies.

The blockade could cost global trade between $ 6 billion and $ 10 billion a week, a study by German insurer Allianz showed on Friday.

Moody’s rating agency expects European auto parts and manufacturing suppliers to be hit the hardest as they operate “just-in-time” supply chains, and said port congestion and new delays in the supply chain were “inevitable”.

Retired British Royal Navy Commander Tom Sharpe said the best bet for the next attempt would be high tide on Sunday, but with the ship stranded bow and stern the hull was in danger of break if rescuers pull too hard.

Mohab Mamish, the Egyptian presidential adviser for Suez Canal projects and seaports, told MBC Misr TV that a floating crane should be used to transfer some of Ever Given’s containers to another vessel in order to alleviate the ship and allow it to float.

Oil prices rose more than 3% on Friday as more than 30 tankers have been idle on either side of the canal since Tuesday, according to Refinitiv shipping data. However, seasonal demand for raw and liquefied natural gas is weak, which will likely moderate the impact on prices, analysts said.

About 4 million barrels of the mostly Kazakh and Russian Urals CPC mix were waiting with tankers carrying Libyan, Azeri and North Sea crude oil for Asian refiners, traders said.

Egyptian pipeline operator SUMED has contacted crude traders to see if they want to reserve space in the system, but so far traders prefer to wait to avoid high additional costs.

Analysts expect a greater impact on the prices of small tankers carrying petroleum products, such as naphtha and fuel oil, for export from Europe to Asia, if the channel remains closed for weeks.

Rerouting ships around the Cape of Good Hope could add around two weeks and additional fuel costs to the trip, said Sri Paravaikkarasu, Asia director of petroleum at FGE.

The blockage weighs on the already weak Asian market for diesel fuel. More than 60% of Asian exports to the west passed through the strangled channel in 2020, according to FGE.

Aframax and Suezmax tariffs in the Mediterranean have also responded as the market begins to price fewer ships available in the region, naval broker Braemar ACM Shipbroking said.

At least four Long-Range 2 tankers that could have headed for Suez from the Atlantic Basin are now likely to assess a passage around the Cape of Good Hope, Braemar ACM said. Each LR-2 tanker can carry around 75,000 tonnes of oil.

The cost of shipping clean products, such as gasoline and diesel, from the Russian port of Tuapse on the Black Sea to southern France jumped 73% in three days to $ 2.58 a barrel on the 25th. March, according to data from Refinitiv Eikon.

On the crude side, traders have had to pay 10-20% more for replacement tankers, but market freight rates have yet to increase as charterers are not ready to commit to higher levels. high in case the container is released this weekend, brokers said.

With Reuters

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