Suez Canal

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The Suez Canal, running from the Red Sea and the Gulf of Suez to the Mediterranean Sea, is a key element of the Egyptian infrastructure. It functions as an important transit route for oil and gas shipments and is a vital source of income for the Egyptian state.[1]

History

The Suez Canal was completed in 1869 after a long history of attempts to connect both the Nile River and the Mediterranean to the Red Sea. Immediately, it had a significant impact on world trade as it steeply decreased the time in which goods could be moved around the globe. When Egypt was forced to sell its shares in the Canal in 1875 due to national debt, conflicts arose over use and control of the Suez Canal. Since then the Canal has been at the center of several international crises, the Suez Crisis of 1956 being the best known.[2]

Technical Information

As of early 2013, the Suez Canal was owned and maintained by the Suez Canal Authority.[3] The canal is 193 kilometers (km) long, 24 meters deep and 205 meters wide. It consists of three parts: the northern access channel (22 km), the canal itself (162 km) and the southern access channel (9 km).[4] A total of 17,799 ships passed the canal both ways in 2011.[5]

Oil and Gas Transit

According to the EIA country analysis, petroleum and liquefied natural gas (LNG) made up 21 percent of Suez cargoes in 2011. In the same year, 20 percent of all ships were petroleum tankers and 6 percent were LNG tankers, with an average of 10 crude tankers 3 LNG carriers per day. A depth extension in 2010 made it possible for 60 percent of all oil tankers to use it, with the exception of both VLCC (Very Large Crude Carriers) and ULCC (Ultra Large Crude Carriers) class tankers. Most of the crude oil shipped through the Suez Canal travels northbound and supplies markets in the Mediterranean and North America.[6]

In 2011, there was an average flow of 535,000 barrels of crude oil per day (bpd) northbound from the Red Sea. While there has been a steep decline in northbound crude oil shipments by almost half their 2008 level, southbound crude transit increased between 2008 and 2010 but fell somewhat in 2011. Changes in the volume of oil passing the canal are a reflection of the collapse in global oil market demand in 2009 and growing demand in Asia, the Energy Information Administration wrote in 2012.[7]

Strategic Value

Generally the Suez Canal is considered a strategic route for Gulf oil shipments to Europe alongside the Sumed Pipeline. Its strategic value mostly derives from the fact that a closure of both the Canal and the Sumed Pipeline would add an estimated 9,000 kilometers of transit around the southern tip of Africa.[8] With total earnings of almost $4.8 billion in 2010, the Suez Canal is also one of the key sources of income to the Egyptian government.[9]

References

  1. "Q&A: Suez Canal", The Guardian, 1 February 2011.
  2. "The Suez Crisis", BBC History, retrieved 5 March 2013.
  3. "Official Website", Suez Canal Authority, retrieved 5 March 2013.
  4. "Canal Characteristics", Suez Canal Authority, retrieved 5 March 2013.
  5. "World Oil Transit Chokepoints", US Energy Information Administraion, retrieved 5 March 2013.
  6. "EIA country analysis" US Energy Information Administration, retrieved 5 March 2013.
  7. "World Oil Transit Chokepoints", US Energy Information Administration, retrieved 5 March 2013.
  8. "World Oil Transit Chokepoints", US Energy Information Administration, retrieved 5 March 2013.
  9. "Q&A: Suez Canal", The Guardian, 1 February 2011.