Vessel grounding halts Suez Canal traffic: Update

Adds details throughout

Transit through the Suez Canal has been blocked after a container ship ran aground in the canal's northbound lane yesterday, halting movements of at least 7.5mn bl of crude.

The container vessel Ever Given ran aground at 7.40am local time (05:40 GMT) yesterday because of a dust storm and high winds, the Suez Canal Authority said. Efforts are underway using tugs to refloat the ship, which was heading from China to Rotterdam.

The incident resulted in 15 vessels being detained at anchorage while waiting for the canal to be cleared, ship agent GAC said. The southbound convoy has also been blocked.

There are signs of a build-up in tanker traffic at both ends of the canal, although there are no indications yet that any vessels have been diverted to alternative routes such as via the Cape of Good Hope, oil analytics firm Vortexa said.

At least 64 southbound and 42 northbound vessels are either in the canal or waiting at outer anchorage that have been delayed by the incident, according to shipping market estimates.

Data from Vortexa show five Suezmax tankers carrying around 5mn bl of crude waiting at the north end of the canal, and at least three Suezmaxes with around 2.5mn bl waiting to enter the south end of the canal from the Red Sea.

Crude futures rose by around 2pc today following the disruption. The Ice front-month May Brent contract was up by $1.27/bl or 2.1pc to $62.06/bl at 9am GMT, after having fallen sharply yesterday.

It typically takes 1-2 days for vessels to pass through the canal, which is one the main transit points for oil and LNG heading from the Middle East to Europe and the Americas, and for Atlantic Basin cargoes heading to Asia.

Flows through the Suez Canal and the Sumed pipeline in Egypt account for around 10pc of global seaborne oil trade volumes, according to US government agency the Energy Information Administration.

By Kevin Foster, Andrew Khaw and Ben Winkley