The 400m-long container ship that is blocking the Suez Canal could take weeks to remove causing massive disruption to world trade.
Ever Given, the 220,000-tonne vessel, ran aground in the southern stretch of the canal early on Tuesday morning, possibly due to high winds.
Severe disruption
John Glen, an economist at the Chartered Institute of Procurement & Supply, told the FT that a prolonged shutdown of the canal risked severe disruption to supply chains.
“If goods have to be rerouted via Africa due to the blockage this could add as much as 10 days to delivery times for UK businesses,” Glen said. “If this does happen it will inevitably lead to shortages of goods and inflationary price rises for consumers”.
About 12% of global trade passes through the Suez Canal, which connects the Mediterranean to the Red Sea and provides the shortest sea link between Asia and Europe, according to the BBC.
Waiting time
Ranjith Raja, an analyst with financial services data firm Refinitiv, said that more than 206 ships are stranded on either side of the canal waiting to transit.
Leon Willems, a spokesman for Europe’s largest port in Rotterdam, told Reuters that every port in Western Europe would be affected.
“When these ships do arrive in Europe, there will inevitably be longer waiting times,” he said.
Oil hike
Fears that the blockage could tie up shipments of crude oil caused prices to rise by 4% in international markets on Wednesday, Reuters reports.
The Kpler energy intelligence service said that more than 20 oil tankers carrying crude and refined products were affected by the jam.
Beached whale
Boskalis, a salvage company involved in the ship’s rescue, likened the operation to trying to free a beached whale, reports the Telegraph.
“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," said Peter Berdowski, the CEO of Boskalis.
Rescuers hope a spring tide on Monday will bring in significantly more water to lift the ship clear. If it cannot be shifted then, the next stage will be to unload the vessel to lighten it.
