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Cargoes Face Extended Wait Times At Panama Canal On Drought

OIL PRODUCTS

The Panama Canal Authority imposed draught restrictions on ships transiting the Neopanamax locks which is likely to support further US diesel tanker conversions.

  • Shippers are facing higher shipping costs and extended wait times at the canal amid transit volumes, as ships need to be lightered to meet draft restrictions according to S&P Global.
  • Water levels at Gatun Lake have fallen faster than predicted as the precipitation in the Panama Canal watershed is well below the historical average according to S&P Global.
  • To avoid congestions, US diesel exporters have ramped up exports to Europe to the highest level since August 2019 in May.
  • US diesel flows to Europe almost doubled on the month to 296kbpd on 1-24 May, Kpler data showed.

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