Suez Canal snarled by giant ship choking key trade route

A giant ship could be stuck in the Suez Canal for days, blocking one of the world’s busiest maritime trade routes that’s vital for the movement of everything from oil to consumer goods.

The Ever Given, a container ship longer than the Eiffel Tower, ran aground in the southern part of the canal in Egypt, leaving dozens of vessels gridlocked as they attempt to transit between the Red Sea and Mediterranean. People familiar with the matter said the canal may be blocked for days.

The 193-kilometer-long (120 miles) Suez Canal is among the most trafficked waterways in the world, used by oil tankers shipping crude from the Middle East to Europe and North America. About 12% of global trade and 8% of liquefied natural gas pass through the canal, as do around one million barrels of oil each day.

No progress has been made so far in floating the vessel and clearing the canal, the Gulf Agency Company, which provides services including Suez transits, said by email. Images released by the Suez Canal Authority showed the vessel’s hull firmly wedged into a banking. They also depicted efforts by the Baraka 1, one of eight tug boats deployed so far in the rescue, to try and yank the ship free.

The weight of the Ever Given — about 224,000 tons — and small size of the tug boats operated by canal authorities have hampered work so far, according to two people familiar with the situation, who asked not to be identified discussing private details. Ship owners are in talks with SMIT Salvage B.V., which has larger tugs, to assist, indicating that it may take days to clear the canal, one of the people said.

Ever Given was grounded early Tuesday amid poor visibility caused by a dust storm and as wind speeds reached 40 knots, resulting in a “loss of the ability to steer the ship,” according to the canal authority. A “blackout” was the cause of the accident, GAC said, without providing more detail.

The vessel deviated “from its course due to suspected sudden strong wind,” Taiwan-based Evergreen Line, the time charterer of the vessel, said in an emailed response to questions. Japan’s Shoei Kisen Kaisha Ltd., among those listed as the ship’s owner, declined to comment.

“The salvage operation with tugs is underway, and hopefully the vessel will be freed soon, but it could last days,” said Ralph Leszczynski, head of research at shipbroker Banchero Costa & Co.

The blockage has led to a big gridlock in the area. About 42 vessels either in the northbound convoy or arriving to transit the canal northbound are now waiting for the Ever Given to be re-floated, Leth Agencies, one of the top providers of Suez Canal crossing services, said in a notice to clients. The company said it is sending a dredger to help free the ship.

About 64 vessels traveling southbound were also affected. GAC said 15 affected ships are waiting at anchorage.

Brent crude climbed 2.9% to $62.52 a barrel by 9.36 a.m. in London, paring heavy losses on Tuesday.

Ever Given was traveling from China to Rotterdam. The crew are safe and accounted for, and there have been no reports of injuries or pollution, according to the ship’s manager, Bernhard Schulte Shipmanagement.

The vessel is carrying cargo for logistics company Orient Overseas Container Line Ltd., according to Mark Wong, a spokesman for OOCL.

At 400 meters in length, Ever Given was built in Japan about three years ago. Shipping companies have been turning to mega-sized vessels to help improve economies of scale, while some key routes — including the Suez Canal — have been widened and deepened over the years to accommodate them.

Navigation is possible along the old canal, the canal authority said. But the vessel is stuck at a point that can’t be bypassed so the old canal can’t help.

The canal has been the site of occasional groundings that have halted shipping. Tugboats managed to get the OOCL Japan unstuck after a few hours in October 2017. In one of the most serious delays, the canal was closed for three days in 2004 after an oil tanker, Tropic Brilliance, got lodged.

Any prolonged disruption could mean ships need to reroute. Bypassing the Suez Canal by traveling around the Cape of Good Hope can add another two weeks to the voyage from Asia to Europe, leading to significant additional costs and disrupting schedules, said Banchero’s Leszczynski.

The shipping industry has had a tumultuous year since the Covid-19 pandemic began roiling global trade in 2020. As countries closed borders to try keep the virus under control, exports from China surged, leading to a dearth of containers and sending maritime rates soaring. The pandemic also exacerbated labor abuse in the industry, with thousands of seafarers stuck on vessels beyond the expiration of their contracts and past the requirements of globally accepted safety standards.