HOW A SUEZ CANAL BLOCKADE AFFECTS OIL FLOWS

Vortexa analysts examine the consequences of the Ever Given’s grounding The blockade of the Suez Canal by the grounded mega-containership Ever Given for close to a week in late March 2021 made it onto news channels worldwide. The reason is that sizeable chunks of global seaborne trade pass through the bottleneck daily, including various relevant clean and dirty oil flows. This article will review the extent to which oil flows were disrupted/delayed and how close the world was to serious supply outages. SUEZ CANAL AS A MAJOR WORLD CHOKEPOINT The grounding of the Ever Given has done more than shed a light on how dependent global trade is on the shipping industry. It highlighted how dependent global shipping is on a handful of canals and straits known as chokepoints. These chokepoints are under a variety of threats and are closely monitored by shipping market participants. The Strait of Hormuz is the world’s most crucial passage when it comes to oil trade. More than a third of seaborne crude oil volumes transit through the strait, according to Vortexa data. Over the years, it has witnessed a number of incidents such as tankers suffering from attacks and vessels being seized....