Megaship blocks Suez Canal: What we know

A giant container ship, almost as long as New York’s Empire State Building is high, got stuck during a sandstorm Tuesday in Egypt’s

Suez Canal, causing a traffic jam of cargo ships through one of the world’s busiest shipping lanes. Here is what we know so far:

What happened?

The 400-metre (1,300-foot) long, 200,000-tonne MV Ever Given, from the class of so-called “megaships”, veers off course in the canal while a gale-force duststorm hits Egypt’s Sinai Desert and much of the Middle East.

The 59-metre (195-foot) wide Taiwan-run, Panama-flagged vessel becomes stuck at about 0540 GMT near the southern end of the canal and diagonally blocks the man-made waterway between the Mediterranean and the Red Sea.

Ship operator Evergreen Marine Corp of Taiwan says the vessel — which was en route from Yantian, China to the Dutch port of Rotterdam — “ran aground after a suspected gust of wind hit it”. But the head of the Suez Canal Authority (SCA), Osama Rabie, tells reporters Saturday the accident may have been due to “technical or human errors”, rather than 40-knot winds.

The 25 crew are unhurt, the hull and cargo undamaged, and there is no oil leak, say the vessel’s managers, Singapore-based Bernhard Schulte Shipmanagement (BSM). Egyptian tug boats, dredgers and bulldozers get to work trying to free the enormous ship.

What’s the impact?

The megaship blocks the shipping artery through which more than 10 per cent of global maritime trade passes, much of it oil and grains. The Suez Canal, opened in 1869 and widened since, is a crucial shortcut between Asia and Europe that saves ships from having to navigate around Africa.

As a result of the accident, more than 300 vessels are now treading water at either end of the canal, says Rabie. Old sections of the canal are reopened to ease the congestion — but this doesn’t solve the fundamental problem, as there is only one lane on the southern end where the ship is stuck.

The blockage of the global trade chokepoint hits world oil markets, as traders anticipate delays in deliveries. Crude futures surge six per cent on Wednesday, but prices tumble Thursday due to nagging pandemic concerns and inflation fears, wiping out those gains.

“We’ve never seen anything like it before,” says Ranjith Raja, Middle East oil and shipping researcher at international financial data firm Refinitiv. “It is likely that the congestion... will take several days or weeks to sort out as it will have a knock-on effect on other convoys.”

Lloyd’s List, a shipping data and news company, says companies are being forced to consider “taking the far longer route around the Cape of Good Hope to get to Europe or the east coast of North America”, a diversion that can take an additional 12 days.

Shipping expert Rose George tells AFP on Friday the blockage was certain to cause price increases for consumers around the world.

In signs of the knock-on effects, Syrian authorities say Saturday they had been forced to ration already scarce fuel supplies, while Romania’s animal health agency says 11 ships carrying livestock out of the country were affected by the traffic suspension.

Egypt is losing some $12-14 million in revenue from the canal for each day it is closed, Rabie says, while Lloyd’s List says the blockage is holding up an estimated $9.6 billion worth of cargo each day between Asia and Europe.

What happens next?

Egyptian authorities deploy 14 additional tugboats to free the stricken ship, says Rabie.

On Saturday night, the ship moves “30 degrees from left and right” for the first time, he adds, calling it “a good sign”. Peter Berdowski, CEO of Boskalis, the parent company of Dutch salvage firm Smit Salvage, which has sent a team, says the complex operation could last days, or even weeks. He equates the massive vessel to “a heavy whale on

the beach”.

Tugboats and crews have been working late into the night under floodlights since Friday to dislodge it. The Ever Given’s owner, Japanese ship-leasing firm Shoei Kisen Kaisha, says the work includes crushing and removing rocks to free the ship.

BSM say one focus is to remove sand and mud from around the port side of the vessel’s bow. The canal authority has said between 15,000 and 20,000 cubic metres of sand would have to be removed in order to reach a depth of 12-16 metres and refloat the ship.

If those efforts fail, salvage teams will look to unload some of the Ever Given’s fuel, water and cargo, though removing the containers would be challenging. Rabie and experts say the salvage operation will try to take advantage of a high tide due to start Sunday night to refloat the ship.