Update: 30 October 2022
The canal revenues surged 27.2% in October on a Y-o-Y basis, reaching USD703.4 mn Vs. USD 552.9 mn, the traffic was higher by 14.6%, with a total of 1,847 ships.
The canal recorded the highest daily traffic across the northbound and the southbound by 90 ships
statement by General Osama Rabie, Chairman of the Suez Canal
Source Alarabyia.net
Published 22 October 2022
Winter is joining forces to advance the global economic crunch as Europe faces one of the most dramatic oil and gas supply instability after the Ukraine war and Russia cut gas supplies. Germany's biggest European economy depended on Russian gas and oil by around 55%, which had now switched to other suppliers, including Saudi Arabia, UAE, and Qatar. Germany, the most significant LNG importer (Liquified Natural Gas) in the European Union, imposed a deal to cap the price for natural gas purchases alongside the Netherlands last Thursday.
A high European purchase appetite to increase the storage capacity before a cold winter fueled the tanker market across gas and LNG carriers, reaching a record high of USD 450,000 for a daily rate, according to WSJ.
The price surge came along with higher delivery rates of shipments to the European ports, which in parallel affecting the canal traffic and justifying a pre-winter increase in tariff prices.
According to the WSJ, tankers are floating near Europe offshore, waiting to off-load; others are waiting for a higher gas price increase or a shift in demand for the Asian market, another constituent of the global order.
A colder winter mid-November could double the upsurge in tankers traffic across GCC to Europe through Suez Canal, as the current storage capacities at major European countries are almost full, according to Reuters. The colder winter is the real test for the storage levels, as higher consumption levels by the end of September increased German consumption by 14%, according to Reuters.
According to Reuters, Germany took additional actions to increase storage levels by leasing four floating storage and re-gasification units to improve the LNG's re-gasification ( Europe faces a shortage in the re-gasification stations, which affects the off-loading cycle).
A process Europe is working on to avoid shortage during winter, also affecting the Suez Canal positively to have a higher pace of tanker traffic for on/off-loading for the northbound and the southbound.
Oil tankers are also part of the traffic surges as European Shifts oil supplies toward Saudi Arabia, according to S&P Global, which will keep higher-than-normal levels of the Canal and avoid any traffic reduction if the world faces an economic recession.
The Suez Canal Authority utilizes the new extension to fasten the tanker's passage from both sides for the northbound and the southbound. The Canal's role is currently more critical for the global economy than the tankers and cargo going worldwide, increasing the country's foreign currency inflow. During a telephone interview with EL Hakya TV Show (presented by Amr Adib), General Mohab Mamesh, Advisor to the President for the projects of the Suez Canal Axis, stated that the Canal traffic increased by 12.8% in August and the Canal targeted revenues of USD 8 Billion will be achieved this year, which came in line with the introduction we published yesterday.
Egypt LNG is another participant in the global market; Egypt owns two LNG export facilities SEGAS (the Spanish-Egyptian Gas Company) and ELNG (the Egyptian LNG facility), on the Mediterranean coast. Egypt reached USD 600 million in monthly exports, the minister of petroleum and mineral resources, Tarek El Molla, stated during the IMF meeting in Washington last week, and targeting USD 1 billion.
We welcome all analysts across the globe to share their ideas about our data coverage for " This Winter Egypt Wins."
through email: egvest@egvest.com
Sources: data mined through ( CNN, WSJ, Reuters, Bloomberg,and S&P Global)
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