March 25, 2021, | CTG Emergency Management, Health, and Hazards (EMH2) Team
The Counterterrorism Group (CTG) is issuing a FLASH ALERT for international shipping organizations, Egyptian Canal Authorities, and international Agencies, Organizations, and Companies (AOCs) that require cargo shipping. This FLASH Alert is also for all that require passage through the Suez Canal. The Suez Canal remains completely blocked after the massive Ever Given cargo ship was shifted by heavy winds, making it impossible for other ships to pass through the channel. As the Suez Canal is one of the most accessed shipping channels in the world, there is an increased risk of further international delays in cargo delivery, excessive queueing of marine traffic, oil price inflation, and piracy opportunities. The current CTG Threat Matrix indicates the likelihood of further delays is HIGH as the Emergency Management, Health, and Hazards (EMH2) team has predicted it will take at least 48 hours to resolve the incident at the Suez Canal.
CTG is on HIGH alert and cautions that the ongoing situation must be monitored closely to assess the impacts on global shipping until the Ever Given is freed and the channel reopens. Delays have already halted 150 ships that are waiting to access the Suez Canal, with more arrivals expected throughout the coming days. Current emergency response teams have deployed tug boats and machinery to dig out the canal to dislodge the ship as quickly as possible. Suez Canal officials opened an alternate channel to divert traffic, but significant impacts on global shipping are expected in the coming days, and possibly weeks.
Satellite Image of the Ever Given Ship Blockage on the Suez Canal
At 0730 local time on March 23, a dust storm producing strong winds and low visibility caused a massive shipping container to run aground in Egypt’s Suez Canal, blocking all remaining vessels from passing through. Despite ongoing efforts by tug boats to dislodge the ship from its near perpendicular position, the situation has not yet been resolved. Canal officials have deployed excavators in an attempt to dig up the canal bed to make additional room for maneuvering the wedged ship. As the major shipping channel connects the Mediterranean and Red Seas, the Suez Canal is the most accessed and important passage that enables the flow of goods between Asia, the Middle East, and Europe. Averaging 50 vessels a day, the bottleneck opening has caused mass marine traffic queues and shipment delays. An old channel has been opened in a bid to alleviate the pressures of the growing marine traffic.
The Suez Canal’s strategic location enables the efficient flow of marine traffic, with major implications for global trade when the channel does not run at full capacity. It is estimated that there will be $9 billion of undelivered goods for each day that the canal is closed, posing major financial consequences for key stakeholders. Additionally, a large number of these vessels are transporting crude oil and other supplies, and their delay has already resulted in a 4% increase in crude oil prices internationally. A small surge in gas and diesel prices may not appear to have significant implications but could be a substantial burden for individuals. The COVID-19 pandemic has already caused a global increase in unemployment, affecting the earnings of individuals who have been laid off. Increases in gas and diesel prices make fuel less affordable, specifically for these individuals and others who have suffered from pay reductions or decreased working hours due to restrictions and curfews. As a result, individuals may have to adjust their priorities to accommodate rising prices. If the canal remains blocked and ships remain stationary, fuel prices are likely to continue rising. Travel opportunities may become limited due to the fuel prices rising, leading to individuals losing out on opportunities such as those that require frequent and/or long periods of travel. Psychologically, dealing with funding avenues increases the risk of stress and further money troubles. Financial stress, along with the impacts of COVID-19 could have long-lasting impacts on the mental health of individuals.
Increased oil prices will also drive up costs for airlines and other forms of air travel. In addition to consumers facing increased airfare, companies who deliver materials via air will also experience increased prices for the fuel required to operate their planes. When the COVID-19 pandemic began, delays in sea travel caused many companies to switch over to air transport. As a result, many COVID-19 vaccines are transported via air. If delays at the Suez Canal persist and oil prices continue to rise, these companies will face challenges in delivering vaccines in a cost-effective and timely manner. Humanitarian-led efforts, such as the COVAX equitable vaccine distribution initiative, are already struggling to gather the necessary funds to provide vaccines to countries in dire need of pandemic relief. Increased costs for air travel could delay these programs and thus contribute to rising case numbers.
Blockage of the Suez Canal additionally contributes to global trade delays that have already been exacerbated by the COVID-19 pandemic and reductions in supply and demand. High demand for supplies to alleviate the pandemic combined with long delays disrupts the distribution of necessary personal and medical protective gear, ventilators, hand sanitizers, respirators, and other resources. Additional pressures on sourcing alternatives or managing the resources available may increase vulnerabilities that could be exploited by individuals or groups, giving rise to terror threats.
Terror concerns have also increased within the Middle East as premium oil facilities are already at risk of terror attacks due to regional tensions. Blockage duration is uncertain and creates an opportunity for government-affiliated actors and non-state actors to amplify the impacts of an attack on energy infrastructure and tankers within the Persian Gulf and the Red Sea. Attacks on energy infrastructure could lead to further complications for replacing the oil swiftly due to the blockage and queueing along the Suez Canal. With limited supplies, demand and price are likely to increase further, hindering the global economy. If prices become too high, international campaigns and protests will likely begin, creating additional attack opportunities.
Piracy attacks must also be considered, although the incident area is not a prime location. However, not far downstream sits the Somalian waters, where the threat of piracy is present and increasing. Cargo ships offer value and are at prime risk of a piracy attack. Attacks have occurred in this stretch of the canal before, but there have been no recent reports since 2008. However, with the incident and the number of sitting ships, this threat cannot be ruled out. It is unlikely that piracy or affiliated attacks will occur where the channel is more populated with waiting ships but as more ships arrive and join the queue, their threat is increased. Towards the tail end of the backlog, ships may become more isolated, increasing their risk of an attack.
At 120 miles long, the Suez Canal can accommodate a large number of vessels at once. However, there are several points along the canal where a lack of security creates vulnerabilities for these ships. Additionally, due to how narrow the canal is, it could be difficult for ships to turn around without disrupting the flow of traffic. In a situation where the canal is completely blocked and vessels are stuck in the 120-mile long stretch, those areas lacking security could become targets for groups looking to attack ships and steal valuable cargo. This type of situation would be extremely difficult to respond to as mobility is limited and resources and personnel are preoccupied with dislodging the Ever Given.
Although tug boats have attempted to turn the ship around, it might not be possible to move the ship until high tide on March 27 or March 28, 2021. Additionally, shipping containers may need to be removed from the Ever Given to decrease the ship’s load, thus increasing its mobility. However, this would result in more delays as the ship contains mass amounts of cargo that will take time, coordination, and proper equipment to handle in suboptimal conditions. Removing cargo could also shift the weight of the ship, resulting in unintended movements and consequences. As delays continue and water space overcrowds with stationary ships, there is potential for collision. This would be especially dangerous considering many of the stationary ships are carrying oil, which could result in an explosion. Additionally, the blockage will create a domino effect. To ensure the safe and efficient transportation of goods through the Suez Canal, logistics experts carefully plan out schedules and routes for each vessel. Unforeseen delays disrupt these schedules and plans for future shipments. Additionally, there will be logistical issues at downstream ports and passages, as docking schedules have to be rearranged to accommodate late arrivals.
The EMH2 team recommends monitoring updates, developments, and weather impacts in the coming days. If extreme weather events are predicted, this could create additional crises wherein multiple ships require emergency services assistance. To alleviate traffic, organizations utilizing the canal for shipping materials should attempt to seek alternate routes, delay shipments, or reconfigure schedules. Decreasing the number of vessels in the area lowers the threat of further incidents. Downstream passages and ports should also work with logistics experts to continuously monitor the progress of incoming vessels to prevent further delays and complications. Facilities and organizations expecting crucial deliveries from vessels stuck at the canal should seek out alternate sources for supplies as it could take weeks for the situation to be resolved. Finally, ship captains and Suez Canal officials should remain vigilant about the possibility of piracy incidents. Security should be tightened throughout the length of the canal, and stationary vessels should be warned of potential threats. For more detailed information, such as a Threat Assessment report, or more tailored reports to specific threats, contact us at email@example.com
CTG and the EMH2 assess that the current threat climate is HIGH. Our evaluation indicates that the Ever Given, idling ships, global trade market, and anyone that relies on the Suez Canal are at risk. We base our evaluation on the current timescale of which the Suez Canal is blocked and the passage schedules that are on hold. Although alternative channels are being used, the implications of the blockage are increasing, which is concerning for global deliveries carrying important cargo such as oil and petrol. Without scheduled deliveries, accessibility to these items is decreased and will significantly impact the economy, resulting in the increasing prices of fuel. Delayed passages will further increase the implications and cause issues over the next couple of weeks.
Our analysis indicates that there is a HIGH PROBABILITY that further shipment delays are expected with repercussions over the coming weeks.
The Counterterrorism Group (CTG) is a unit of the global risk consulting and security firm Paladin 7. CTG proactively searches for and analyzes the threat of terrorism that comes from International Terrorist Organizations, Domestic Terrorist Organizations, and Individuals determined to inflict terror upon societies, organizations, and individuals. Our international and national security professionals set up protective measures to detect, deter, and prevent, discourage, and dissuade any terrorist organization or individual from attacking organizations and individuals. We work to protect our clients from any terrorist threat or attack. We also work proactively with the proper authorities to find those in terrorist organizations and individuals who will cause harm and assist in bringing them to justice and mitigating the threat long-term.
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