Slump in flows reflects dramatically lower European fuel consumption as pandemic decimates demand.
Egypt’s Suez Canal handles about 10 percent of international maritime trade and is one of the world’s busiest waterways, providing a crucial link for oil, natural gas and cargo shipping between the Atlantic Ocean and the Pacific Ocean.
When opened more than 150 years ago, the canal was 164km (102 miles) long and eight metres (26 feet) deep, but after several expansions throughout the years, it is now 193km (120 miles) long and 24 metres (78 feet) deep.
The canal remains one of Egypt’s top foreign currency earners.
On average, 50 vessels pass through the Suez Canal every day.
According to the Suez Canal Authority (SCA), nearly 19,000 ships, with a net tonnage of 1.17 billion tonnes passed through the canal during 2020 in “the second-highest load in the history of the canal”.
The majority of oil transported by sea passes through the Suez Canal, which is the fastest crossing between the Atlantic Ocean and the Indian Ocean but demands hefty passage tolls.
The journey between ports in the Gulf and London, for example, is roughly halved by going through the Suez – compared with the alternate route around the southern tip of Africa.
Most of the cargo travelling from the Gulf to Western Europe is oil. Manufactured goods and grain also pass through the canal often between Europe and North America and the Far East and Asia.
On Tuesday, a large 200,000-tonne container ship heading to Rotterdam ran aground in the Canal.
The 400-metre long container ship Ever Given’s hull became wedged length-ways across the canal lane, causing a gridlock of at least 100 vessels.
The container ship has been partially refloated and traffic is expected to resume soon, port agent GAC said, citing the Suez Canal Authority.
The blocking of all traffic in the Suez by Ever Given could have a major knock-on effect for global shipping moving between the Mediterranean Sea and the Red Sea.
Ten tankers carrying 13 million barrels of crude could be affected by the grounding, according to oil analytics firm Vortexa. Reroutings will add 15 days to a Middle East to Europe voyage, the firm added.
Oil prices have shot up by 2 percent due to the incident.
Brent crude for May settlement jumped 2.1 per cent to $62.09 per barrel, after having tumbled 5.9 percent and hit a low of $60.50 the previous day.
West Texas Intermediate (WTI) crude futures for May delivery were up 2 percent at $58.95 per barrel, after having lost 6.2 percent in the previous session.