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The “Evergiven”, a 400-meter-long vessel, blocks traffic in both directions via one of the world’s busiest canals for the transport of oil, grain and other between Asia and Europe.
Dealers have been forced to replace some of the empty tanker trucks that were due to head north through the canal to load oil from the Mediterranean region, but many are betting the situation will be resolved in a matter of days.
“The redirection to Africa can increase the shipping cost by around $ 400,000, as well as the flight time by two or three weeks, which should also be taken into account,” said a source in the maritime industry, who spoke on condition of anonymity.
He continued, “At present, tenants do not cost money. The closure will affect the delivery time, but there are no late penalties as there are no clauses related to the closure of the Suez Canal. “
How much oil crosses the canal?
Of the 39.2 million barrels per day of crude oil imported by sea in 2020, 1.74 million barrels per day passed through the canal, according to Kepler’s tanker traffic data.
What is the direction of the flow of crude oil?
Crude oil and refined products circulate in both directions in the Suez Canal, which is 193 km long.
In 2020, Europe imported 550,000 barrels per day of crude from sources east of Suez, most via the canal, according to Kepler figures.
Imports from South and East Asia through the channel amounted to 1.27 million barrels per day in June 2020, but deliveries subsequently declined to 310,000 barrels per day in November.
What about refined products?
Slightly less than the 9 percent or 1.54 million barrels a day of global imports of refined products passed through the Suez Canal last year, according to Kepler. Naphtha, a raw material for the plastics industry, constitutes a large part of the refined product supply that uses the channel.
Kepler says there are two distillates loaded with diesel and jet fuel waiting to sail to the Mediterranean, while two tankers wait for Nafta to set sail east.
Egyptian pipeline “summoned”
The 320 km SUMED pipeline connects the Gulf of Suez to the Mediterranean Sea and carries 80% of the oil destined for Europe, according to the Sumed website.
The Sumed pipeline connects Red and Mediterranean Bahrain and has a capacity of over 2.5 million barrels per day. The US Energy Information Administration said it witnessed an inflow of about 1.3 million barrels per day in 2018, with the line’s capacity at about 2.8 million barrels per day, but it is used at much lower rates most of the time.
The operator of the Sumed line has spoken to oil traders about whether they want to use the line to transport crude given the suspension of the Suez Canal, which could last for weeks due to the door crisis. – overdue containers.
A trader said that transporting oil using SUMED could also be very expensive and unattractive, with the exception of giant tankers with a tonnage of one million barrels.
Another dealer explained that the line could cost around 50 cents to the dollar a barrel, in addition to the fact that switching to it now could cost the ship’s charterer the full shipping cost anyway.
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