If you think our weekly social-media posts on fuel-price updates are enough reason to weep on Mondays, you’d better get some napkins and prepare to cry some more. That’s because a recent maritime incident on the Suez Canal may further raise the prices of fuel not just in the Philippines, but also in the rest of the world.
With oil prices already on a steady rise as a result of the economic recovery from COVID-19, a Business Insider analysis predicted that these could go up sharply due to the blockage of one of the world’s busiest shipping lanes. Over 850,000 barrels of oil bound for Asia and another 600,000 destined for Europe and the US pass through the Suez Canal daily. In fact, Brent crude prices have already risen by 4% following the incident.
The Taiwanese-owned container ship Ever Given ran aground while traversing the Suez Canal on March 23, and has blocked the entire width of the waterway. There are reportedly up to eight tugboats attempting to get the 400m long vessel unstuck with no success so far. Dredging the canal’s sand banks is being considered if the ship’s hull could not be freed using conventional means.
There is already a long queue of ships waiting for the Egyptian waterway to reopen. Without it, vessels traveling between Europe and Asia would have to sail all the way around the Cape of Good Hope in Africa. This extends the voyage by up to 10 days and consumes more fuel, which obviously affects the cost of transporting goods (like oil and vehicles) around the world.