This Wednesday crude oil prices were affected by an interruption in the circulation of the Suez Canal. Faced with an already volatile price scenario, the obstruction generated more speculation.
Like the Strait of Hormuz and the Panama Canal, the Suez Canal are key waterways for world trade and any obstruction or inconvenience that creates delays is counterproductive for supply chains.
The port authorities are working on the Suez Canal to restore its proper circulation. It is a work against the clock, since the road agglomerates approximately 12% of world trade and 8% of liquefied natural gas and the circulation of at least one million barrels of oil per day.
It is the vessel called Ever Given, a container ship that is aground in the south of the Suez Canal. It was traveling from China to Rotterdam and has a length of 400 meters. The entities that work on the site have the tide times to move the boat and estimate to free the circulation for Thursday.
The very high circulation in the Canal, causes that in this situation, there are hundreds of vessels affected, Bloomberg collected information from at least 150 vessels. They are mostly bulk carriers, container ships and oil or chemical tankers
The Suez Canal is one of the busiest waterways in the world, transporting goods and merchandise to and from all over the world. With a length of 193 kilometers, it allows the exchange of crude oil between the Middle East, Europe and America.
The interruption in the circulation in the Suez Canal, caused alterations in the price of crude oil this day. The price of this merchandise rose around 6%, fueled by concerns that the crude will not be delivered on time.
Prices for West Texas Intermediate on Tuesday fell from $ 61.17 to $ 57.33, one of the biggest losses since February. However, before this event, the values rose to $ 60.92 (4.30pm GMT -3).
For the BRENT benchmark, the situation was identical, presenting losses on Tuesday from $ 64.22 to $ 60.37, to jump to $ 63.98 (16.30 GMT -3).
The rise was also motivated by growth in US inventory figures, which show a revival in refinery activity. Inventories grew to pay off after a halt due to cold weather in Texas in the past month.