Suez Canal: Biden Offers Help As Ships Head to Cape of Good Hope | Suez Canal

Joe Biden has said the United States is studying what it can do to help free the 400-meter container ship Ever Given from its position blocking the Suez Canal as the crisis on trade routes drags on until the fifth day.

“We have equipment and capacity that most countries do not have. And we are seeing the help we can provide, ”the US President said in Delaware on Friday. His comments came after a US official said the navy was prepared to send a team of dredging experts to the canal, but was awaiting approval from local authorities.

Meanwhile, when the latest effort to dislodge the tugboat was called off late Friday, shipping companies began diverting loads elsewhere to avoid worsening the huge traffic jam that has accumulated at both ends of the crucial commercial artery. .

Maersk said 22 of its ships had been affected so far and that it had so far diverted two of its ships around the Cape of Good Hope in the southern tip of Africa.

A spokesperson said: “We are closely monitoring the development of the floating operations of the affected vessel to better assess the measures to be taken to mitigate the delay of the affected cargo. The longer it takes to re-float the ship, the greater the risk that we will see serious bottlenecks in the ports of northern Europe and the greater the obstacle to clean up ”.

The ship’s Japanese owner, Shoei Kisen Kaisha, said his aim was to free the ship on Saturday afternoon UK time, but could not guarantee that the effort would be complete by then.

Shipping rates for petroleum product tankers have nearly doubled since the ship was stranded, and efforts to free the giant ship can take weeks and be complicated by unstable weather, threatening costly delays for businesses. who are already dealing with Covid-19 restrictions.

A Dutch rescue team had confirmed that two additional tugs would arrive on Sunday to help evacuate the ship, Ever Given technical manager Bernhard Schulte Shipmanagement (BSM) said.

Earlier, the Suez Canal Authority (SCA) said that efforts to free the ship by tugboat resumed after the completion of dredging operations on her bow to remove 20,000 cubic meters of sand.

“Trawling operations require the availability of a number of supporting factors, including wind and tidal direction, which makes it a complex technical process,” the authority said.

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

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

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

Rating agency Moody’s expects European auto parts and manufacturing suppliers to be hit the hardest because they operate “just-in-time” supply chains, saying port congestion and further supply chain delays were “unavoidable. “.

Retired British Royal Navy Commander Tom Sharpe said the best bet for the next attempt would be a high tide on Sunday, but because the ship was beached both front and rear, there was a risk of the helmet would break if rescuers pulled too hard.

Mohab Mamish, the Egyptian presidential adviser on 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 ship to lighten the ship and allow it to float.

Oil prices rose more than 3% on Friday as more than 30 tankers have been idle on both sides of the canal since Tuesday, Refinitiv shipping data showed. However, there is a low seasonal demand for crude and liquefied natural gas, which will likely mitigate the impact on prices, analysts said.

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

Egypt’s SUMED pipeline operator approached crude traders to see if they wanted to reserve space in the system, but traders so far prefer to wait to avoid high additional costs.

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

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

The blockade is affecting the already weak Asian market for diesel or diesel. More than 60% of Asian exports to the west flowed through the drowned Canal in 2020, according to FGE.

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

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

The cost of shipping clean products, such as gasoline and diesel, from Russia’s Black Sea port of Tuapse to southern France rose 73% in three days to $ 2.58 a barrel on March 25, according to Refinitiv data. 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 levels. higher should the container be released this weekend, ship brokers said.

With Reuters

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