The Suez Canal experience significant decline in commercial ship transits

The Suez Canal, a vital conduit for global trade, is undergoing a significant drop in commercial ship transits, marking the lowest levels since the notorious blockage by the Ever Given nearly three years ago. According to a report from Bloomberg, data sourced from the International Monetary Fund and Oxford University reveals that the seven-day moving average of daily Suez crossings has dwindled to 49 as of Sunday.

This decline is attributed to attacks on vessels in the vicinity of the Red Sea, prompting a shift in global trade routes toward longer and more expensive alternatives. The seven-day moving average of daily Suez crossings, encompassing bulk cargo ships, container carriers, and tankers, has experienced a notable reduction from its 2023 peak of 83 transits in late June.

This downturn is evident in a year-on-year comparison, with the current average of 49 transits standing lower than the corresponding figure of 70 a year earlier. The decrease in traffic mirrors the aftermath of the Ever Given blockage in March 2021, which led to widespread disruptions in global supply chains.

A significant consequence of the decreased Suez traffic is the concurrent rise in the number of ships opting for the longer journey around the Cape of Good Hope, situated near the southern tip of Africa. The Cape route has become an alternative for vessels rerouting their courses due to challenges and risks posed by the Red Sea. Maritime experts highlight that these diversions not only result in longer voyage durations but also incur higher costs for shipping companies, thereby impacting the overall efficiency of global trade networks.

As the Suez Canal witnesses reduced traffic, the Ever Given, the vessel central to the 2021 blockage, has taken an alternative route. Ship-tracking data indicates that the Ever Given is currently positioned in the middle of the Indian Ocean, heading east toward Sri Lanka. The ship’s journey commenced in mid-December, aligning with diversions prompted by security concerns near the Red Sea.