Suez Canal Blocked By Stuck huge Ship| $400 Million an Hour Loss

One of the world's busiest shipping lanes is congested. The Suez Canal is a critical artery for foreign trade, but one of the world's biggest container ships is currently blocking it. When the world's largest container ship became trapped in the Suez Canal, a mems frenzy erupted on social media.

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How Did Ever Given get stuck on Suez Canal?

Ever Given is one of the world’s biggest ships about 400 meters long and weigh nearly 2,00,000 metric tons. It can haul more than 20,100 steel boxes making it one of the largest container ships. Due to high winds and a dust storm, the vessel became stranded diagonally across the canal's single-lane southern stretch on the morning of March 23. The Suez Canal is only 738 feet, preventing the boat from turning around within the narrow aquatic boundaries.

 

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Suez Canal and Global Trade:

Let’s first give you some numbers to help understand the extent of this crisis the blockage has halted the trade of at least 6.3 million barrels of crude oil this is worth 400 million dollars. The ship's owner and insurers are expected to face millions in claims, According to reports. Container ships like this one are insured for 100 to 140 million dollars in damage. According to the report, the losses for those involved are significant; they are losing $400 million per hour.

The Mediterranean lost all power and began to run sideways, resulting in a nightmare for global trade. These two canal, like the Suez Canal has been one of the globe's most strategically important waterways, going to carry about 12% of global trade each year, worth roughly 1.1 trillion dollars in Manchester.

Report Suggests the entire crew of the skyscraper-sized cargo happens to be Indian. The ship's 25-member crew is safe and accounted for, according to Bernhard Schulte Ship Managements. The company also stated that when the ship grounded, it was accompanied by two pilots from Egypt's canal authority.

The Current Rescue :

Dredgers are still attempting to loosen the vessel to pull it out. The report suggests an elite salvage squad is due to arrive at work on prizing the Ever Given from the bank of the canal. According to the salvage company, the massive containership that is blocking the Suez Canal like a "beached whale" could take weeks to free.

The salvers may have to lighten the ship by removing things like the ballast water, which helps to keep the ship steady when they are at a sea. The report suggests fuel could also be unloaded.

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Also readout:-Good news of Provident fund, Gratuity and Pension benefits for Indian seafarers

Trade Impact :

The Suez Canal in Egypt is one of the busiest waterways in the world, with tankers transporting crude oil from the Middle East to Europe and North America.

Data suggest on March 24, 185 vessels, mostly bulk carriers, containership, and oil or chemical tankers were waiting to cross the canal.The route is heavily used by refiners all over the world, raising concerns that the blockage will have an impact on global energy markets...

The shipping industry faces a major risk as more ships choke points including the Suez, Panama Canal, the Strait of Hormuz, and Malacca Strait. A similar occurrence is likely to become more common as ships get bigger and waterways get more congested.

Oil companies are gearing up to prepare for the worst because firms are looking to book tankers with options to avoid canal. The instability comes at a time when oil prices are already volatile.

According to reports, The blockage is estimated to cost $400 million per hour... The Japanese owner of the cargo ship has apologized for the disruption to global trade.

Also read:- 2021 India Maritime Summit: Maritime India Vision of 2030 Released

What Does This Signify for India?

Congestion in the Red Sea and the Mediterranean Sea is preventing a significant portion of global shipping from moving. The delay in the delivery of oil, petroleum, and other product to major markets will escalate shipping costs and impact global trade.

India is a top importer of crude and product via Suez Canal with nearly 500000 barrels imported every day. India is followed by China, South Korea, Singapore, and the Netherland.

While many nations are heavy exporters of crude and other products via the Suez canal, each Shipping significantly more than 200000 barrels per day. Reuters report raised concerns about the incident potentially constraining crude shipment resulting in a further rise in oil prices