Greek Shipping Giant Warns Panama Canal Chaos May Hit Suez
Angelicoussis Group Exec Says Suez Could Face Backup, Further Affecting LNG Shipments
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Unprecedented congestion at the could ultimately result in delays at Egypt鈥檚 , potentially affecting cargoes of liquefied natural gas, according to a top official at Greek shipping giant .
鈥淪uez will need to take a lot more vessels鈥 as a result of the crisis in Panama, , the company鈥檚 deputy chief executive officer, said at a conference in Athens. 鈥淭hat means that the waiting time on both ends likely will increase.鈥
A lack of rainfall has dried up a key lake at the Panama Canal, hobbling shipments through one of the world鈥檚 most important waterways. The resulting delays have already upended global commerce, forcing some ships to take the long journey around South America.
The Suez Canal, an alternate route for vessels traveling between the U.S. and Asia, has handled congestion issues 鈥渧ery well over the years,鈥 making it 鈥渓ess of an issue, but obviously it鈥檚 something you need to be aware of,鈥 St酶hle said. Suez has a larger capacity than the Panama waterway, enabling it to handle more ships per day.
Angelicoussis Group, which was founded in 1947, serves the oil, gas and dry cargo markets. With a fleet that has 29.5 million deadweight tons of transportation capacity, it鈥檚 Greece鈥檚 largest shipping company, according to data from , a unit of the world鈥檚 biggest shipbroker.
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Because of the backup at the Panama Canal, only companies that have pre-booked slots will be able to use the waterway, according to St酶hle. Only about four or five LNG vessels are now transiting the canal each month, compared with one a day before the crisis, he said.
Prolonged congestion could also lead to a tighter ship market as the world increases its hunger for the fuel. Typically, two vessels are needed to haul a million tons of LNG from the U.S. to China, according to St酶hle.
鈥淚f you can鈥檛 go via the Panama Canal, you have to add one more ship for the same volume,鈥 he said. 鈥淲here do you get the ships from? That鈥檚 going to be a challenge.鈥
Europe in particular has become increasingly reliant on LNG as it replaces pipeline gas from Russia, the region鈥檚 former top supplier. This should continue for the another three or four years, though the real long-term demand for the fuel will be in Asia, requiring more ships to travel longer distances, according to , the firm鈥檚 CEO.
While more ships are being built, a large portion of older steam vessels is being phased out. 鈥淭he market will be in balance if not tight,鈥 she said at the same conference.
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