International oil prices surge on a single ship…

International oil prices surge on the prospect that the paralysis of the Suez Canal in Egypt, which is a key trade route between Asia and Europe, will be prolonged than originally expected, and the global economy is also having a ripple effect.

Suez Canal, with a width of 280m, is currently blocked by the super-large container ship Evergiven. On the morning of the 23rd (local time), the Evergreen Lake suddenly lost control and was stranded with its bow and stern touching both banks of the canal.

According to the AP news agency on the 25th, Egypt’s Suez Canal Administration (SCA) said, “We are trying to get the ship out of the sandbar through a tugboat, but the towing work is delayed as the water level in the Suez Canal is lowering due to the low tide.”

Bloomberg News, citing experts, predicted that it would be difficult to lift the Evergiven before at least the 28th. The water level in the canal must rise before the vessel can be floated and moved. Nick Sloan, who was in charge of lifting the Italian super-large cruise ship’Costa Concordia’ in 2012, said, “On the Suez Canal, the difference between the tide and the low tide is maximized and the water level rises by 46cm, so there is no space to move the hull. It will happen,” he said.

The upcoming sari is from 28 to 29 days. If this period is missed because the work is not going well, the situation can last for a few more weeks. This is because the next sari comes back only after 12-14 days. There is also a way to reduce the weight of the ship by lowering the container on board, but this also takes several weeks.

Immediately after the accident, SAC put 8 tugboats on the site to lift the hull, but the scale of the ship was so great that it was difficult. The Evergiven is 400m long, 59m wide, and weighs 220,000 tons. In the Suez Canal, traffic was temporarily restricted in 2004, 2016, and 2017 due to ship accidents, but there was no case of a very large container ship aground and completely blocked like this.

The exact cause of the accident has not yet been identified. Taiwanese company Evergiven, which operates the Evergiven, said, “It is believed that the hull crashed with the floor as it left the course due to the sudden strong wind.”

As the global logistics aorta is suddenly blocked, the crude oil market is rocking right now.

On the 24th, at the New York Commercial Exchange (NYMEX), Western Texas Oil (WTI) for May delivery closed at 61.18, an increase of 5.9% ($3.42) per barrel compared to the previous day.

Marshall Gittler, director of investment research at BD Switzerland, told Marketwatch that “about 10% of international maritime crude oil traffic passes through the Suez Canal,” said the market’s keen response to the paralysis of oil tankers moving in the Gulf waters.

According to Bloomberg News, there are currently 185 vessels waiting to resume operation. A local official said, “Every time the sailing is delayed by one day, the shipowner suffers a loss of 60,000 dollars (about 70 million won).” The Wall Street Journal (WSJ) reported that it would take two more weeks for ships waiting on the Suez Canal to detour to the Cape of Good Hope in Africa, increasing the loss of shipowners.

Reporter Jeong Eun-hye [email protected]