Brent crude rose by $1.75, or 2.9 percent, to $62.54 a barrel by 10:21 GMT on Wednesday, after tumbling 5.9 percent on Tuesday, as Egypt continues efforts to re-direct a giant container carrier
that blocked the parallel channel of the Canal Suez.
Ten tankers carrying 13 million barrels of crude and oil could be affected by the disruption of navigation in the Suez Canal so far, Vortexa Analytics, the oil and gas analytics platform, said on Wednesday.
“If tankers start diverting towards the Cape, any increase in tonne-miles will increase tanker utilisation and support rising freight rates in the short-term,” tweeted freight analyst Richier Arthur on the company's account.
On Tuesday, a Taiwan-owned container ship coming from China and travelling as part of the southbound convoy on its way to Rotterdam lodged sideways at the canal's 151km mark due to bad weather, blocking the parallel channel of the canal.
Operations to rescue and float the giant container ship MV EVER GIVEN are underway, the Egyptian Suez Canal Authority (SCA) stated on Wednesday.
The SCA added that eight tug boats have been attempting to re-direct the vessel, which is 400 metres long, 59 metres wide and can carry up to 224,000 tons.
About 12 percent of world trade passes through the Suez Canal, which is fastest water artery between Europe and Asia.
"The approximate rate of backlog is 50 vessels per day and any delays leading to re-routings will add 15 days to a Middle East to Europe voyage," the oil and gas analytics platform added.
Oil prices rose more than two percent on Wednesday with analysts saying that “the potential disruption to supplies has lifted prices,” according to Reuters.
“The reprieve seems temporary, though”, Jeffrey Halley of OANDA brokeragesaid.
According to Vortexa the top three exporters of crude and oil via the Suez Canal in 2021 are Russia, Saudi Arabia, and Iraq with a total of 1,356 barrels per day.
The container ship "has now blocked off a lot of fully-laden tankers from traversing in either direction," trade monitor website TankerTrackers tweeted on Wednesday. "Tankers carrying Saudi, Russian, Omani, and US oil are waiting on both ends," it added.