The conflict in the Middle East has increased traffic through Panama's interoceanic canal, especially of vessels transporting LNG, the waterway's administrator Ricaurte Vasquez said.
The canal is benefiting from the significantly reduced traffic through the strait of Hormuz because of the Middle East conflict, which has curtailed the movement of oil and gas carriers from several countries including Kuwait, Qatar and Bahrain.
The conflict is also affecting traffic through the Suez Canal.
The Panama Canal handled four LNG carrier transits/month before the crisis, but LNG traffic has been increasing since the start of March and the canal will be able to offer one additional slot.
But although the canal's capacity is designed to handle these temporary increases, continuity will depend on how the situation in the Middle East evolves, Vasquez said.
The canal registered 4,156 ship movements in the first four months of its fiscal year that started in October, a 2.8pc increase on the same period a year ago, according to the canal authority.
The increase in traffic has also coincided with the availability of water for the canal that is allowing up to 40 transits/d, four more than the canal's authority projected for this year, Vasquez said.
"It is likely that cargoes such as LNG will be diverted to the US, which will generate more demand for the canal," Vasquez added.
The volume of transits through the canal was suppressed in 2023-2024 by low water levels caused by a drought that affected several parts of Central America.
But the canal has enough water now, so it is working at full capacity, Vasquez said.
"Cargoes must reach their destinations and the shortest route is still Panama," he added.
