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Suez Canal Traffic Disrupted After Ship Runs Aground, Weather Blamed, Unclear When Traffic Resumes

Tyler Durden's picture




 

It's not quite snow. But it's close. Reuters reports that traffic in the
Suez Canal has been disrupted since 8am GMT after a ship ran aground
due to "engine failure in bad weather." There is no indication of foul
play yet.

From Reuters:

 Traffic through Egypt's Suez Canal has been disrupted since 0800 GMT on Tuesday after a ship ran aground due to engine failure in bad weather, a maritime source said.

"A cargo ship ran aground due to an engine malfunction in the southern sector of the canal, blocking five ships behind it," the source said.

The source could not specify when traffic would resume.

Five of Egypt's Red Sea ports were also closed on Tuesday due to bad weather, a spokesman for the Red Sea Ports Authority said.

"We have closed ports ... due to the increase of wind speed to 40 knots per hour, lack of visibility, and high waves reaching 3 metres," said the spokesman, Salah al-Hashem, adding that the ports would be opened once the weather improved.

The closed ports include Nuweiba, Port Tawfik and Adabiya.

Look for the record Brent-WTI spread to jump even wider on the news, that is, of course, assuming that there is any correlation between events in the real world and prices.

 

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Tue, 02/15/2011 - 08:30 | 962960 Oh regional Indian
Oh regional Indian's picture

Feeling a little prescient.

Weather, if controllable, is such a force, not necessarily of nature.

ORI

http://aadivaahan.wordpress.com/2011/02/14/oil-crisis-in-a-thousand-words/

Tue, 02/15/2011 - 08:42 | 962963 More Critical T...
More Critical Thinking Wanted's picture

Weather can impact supply and can push up prices - but so can other supply & demand forces.

Just look at the evidence, right here in the article:

Look for the record Brent-WTI spread to jump even wider on the news, that is, of course, assuming that there is any correlation between events in the real world and prices.

Supply & demand forces work just fine for WTI.

With the Fed 'printing trillions', the only force that could keep American oil [*] cheap is that right now there's WTI oversupply (Canadians pumping and pumping) and lower WTI demand for it (refinery maintenance, plus the gas-guzzling season not starting up yet).

I.e. the WTI - Brent crude spread is one of the clearest pieces of evidence against the notion that it's the Fed that is increasing commodity prices ...

[*] also meaning: 'it is the easiest for Wall Street to pour liquidity into WTI'

 

Tue, 02/15/2011 - 08:32 | 962961 More Critical T...
More Critical Thinking Wanted's picture

 

weather bitchez and solar flares:

Solar Cycle 24 is heating up again: sunspot group 1158 has produced the strongest solar flare in more than 4 years (and a massive X2 one - heading earth-wards):

http://blogs.discovermagazine.com/badastronomy/2011/02/14/first-earthwar...

Movie of the flare:

http://spaceweather.com/swpod2011/15feb11/x2flare.gif?PHPSESSID=sr7r36b4...

And that's just the beginning - the peak of the solar cycle is expected to somewhere around 2013/2014.

Not the best news for this year's and next year's harvest - and 2010 was the hottest year on record already, with a solar minimum - it's anyone's guess how hot 2011 is going to be with a strong solar cycle ...

Remember: demand for food is so inelastic that just -1% of grain supply reduction needs a +20% food price increase before demand will drop by 1% as well ...

Global cooling bitchez.

 

Tue, 02/15/2011 - 08:40 | 962969 Pants McPants
Pants McPants's picture

Please go away.

Tue, 02/15/2011 - 10:03 | 963174 LowProfile
LowProfile's picture

Hey, I'll be the first to say he's a professional asshole (in fact, I am the first).

But on this, he's right.

Credit where it is due!

Tue, 02/15/2011 - 08:43 | 962971 EscapeKey
EscapeKey's picture

just -1% of grain supply reduction needs a +20% food price increase before demand will drop by 1% as well ...

[citation needed]

Of course, that's a common occourance with the lies you spew, lee0326.

Tue, 02/15/2011 - 08:50 | 962978 More Critical T...
More Critical Thinking Wanted's picture

just -1% of grain supply reduction needs a +20% food price increase before demand will drop by 1% as well ...

[citation needed]

Here are current estimates of food demand inelasticity:

http://www.ers.usda.gov/Data/InternationalFoodDemand/

For example demand elasticity for breads is estimated at 0.04, meaning that to get 1% in demand reduction the price has to go up  by about 25%.

The reason behind this huge inelasticity is well known: people all around the globe tend to pay up (and bid up prices against each other), when the other option is starvation and death ...

This is why food prices can be very volatile when supply meets demand and this is why last year's ~4% reduction in supplies (bad grain harvest in Russia and bad one expected in China) and 1% increase in demand had such a huge effect on food prices.

 

Tue, 02/15/2011 - 08:54 | 962987 EscapeKey
EscapeKey's picture

Oh excellent, more government sources to justify government data. Nice one, lee0326.

As far as I can tell, 0.04 refers the bread in the United States. The figures for low-income countries, according to your trusted government source, is 10x higher.

Tue, 02/15/2011 - 09:17 | 963021 More Critical T...
More Critical Thinking Wanted's picture

Oh excellent, more government sources to justify government data. Nice one, lee0326.

I'd have expected a concession from you, not further denial.

Food demand inelasticity is a well-known phenomenon - you can look it up in a dozen other places if you flunked your first class in economics.

You can also try it out yourself: go to a deserted island with a friend and with 1 million dollars each and stay there for two months. Sorry, there's no food on the island. 2 weeks into your vacation someone will visit you guys and will sell you exactly 1 loaf of bread per week, in an open outcry auction.

I'm curious how high food prices will be on that island.

As far as I can tell, 0.04 refers the bread in the United States. The figures for low-income countries, according to your trusted government source, is 10x higher.

And with globally negotiated prices guess whose bid wins, yours or the guy's from Egypt?

And yes, as we've seen about 40% of a price increase and 4% of a supply/demand spread worsening we can estimate average, global inelasticity: 0.10.

You are a real noob when it comes to economics, I really hope no-one's financial future relies on your advice.

 

Tue, 02/15/2011 - 09:19 | 963035 EscapeKey
EscapeKey's picture

OH RIGHT, so 0.04 IS the American figure, which you now claim to be universally applicable, because "the US will win in the fight for bread".

Fuck right off back to reddit, lee0326.

You know your argument is flawed, and yet you try to pass it on anyway. You are nothing but a lying sack of shit.

Tue, 02/15/2011 - 09:34 | 963071 More Critical T...
More Critical Thinking Wanted's picture

 

OH RIGHT, so 0.04 IS the American figure, which you now claim to be universally applicable, because "the US will win in the fight for bread".

Correct, that's what happens in capitalism: the highest bidder gets the deal and sets the prices. Yes, the rich are starving the poor - this happens both for food and for oil.

Your level of denial is astounding. You were fantastically wrong, you now even know and indirectly admit that you were wrong: post after post you denied the basic fact that supply & demand controls food prices. Now that you are facing actual numeric estimations about the supply & demand forces controlling food prices you feign outrage over them being estimations.

That's a new low for this discussion really.

 

Tue, 02/15/2011 - 09:38 | 963087 EscapeKey
EscapeKey's picture

Correct. Correct. Excellent, here we have admission that not only were your original statement a bald faced lie, you actively tried to pass it on as truth.

Tue, 02/15/2011 - 10:02 | 963171 More Critical T...
More Critical Thinking Wanted's picture

 

You are still in denial. You are sensing that your position of blaming the Fed is indefensible and you are trying hard to find any mistake in inelasticity estimations.

Hint: they are estimations.

You really need to stop the handwaving.

 

Tue, 02/15/2011 - 10:13 | 963184 LowProfile
LowProfile's picture

Give it up on food inelasticity.  Some people have to be right all the time (because they gots too many undeserved gold stars in kindergarten).

Except she's right on the Fed.  Their money printing is causing speculation worldwide, which is resulting in cost-push inflation.  So there, you're wrong.  Asshole!

Wed, 02/16/2011 - 06:03 | 963260 More Critical T...
More Critical Thinking Wanted's picture

 

Give it up on food inelasticity.

Yeah, I know, the "blah, blah, blah the earth is FLAT and the Fed is EVIL!" argument she picked up in kindergarten. It's not particularly convincing.

Life is a bitch: things fall down, the planet is round, 2+2=4 and demand for life's necessities is inelastic.

Which part of "last year Russia banned all grain export, so bad was the heat, fire and drought" did she not understand? This basic supply & demand force had catastrophic effects on North-Africa in particular, which imported a lot of grain from Russia. Not the Fed ...

Correct predictions were made back then, early August 2010:

"Russian wheat export ban threatens higher inflation and food riots" [August 2010]

http://www.independent.co.uk/news/business/news/russian-wheat-export-ban...

Food demand is awfully inelastic (I cited numbers), the west literally starves the the rest of the world until they reduce food consumption. The poorest countries are hit the hardest: the market does not even blink when survival becomes impossible economically. (i.e. when food prices raise above wages)

Riots in more places are to be expected as building out more food production capacity and fighting the effects of global warming takes time.

 

Tue, 02/15/2011 - 08:53 | 962986 johnQpublic
johnQpublic's picture

5% loss of oil supply in the 70's led to 300-400% price increase at the pumps

 

at least the AGW folks can STFU now

its the SUN dammit

unless of course daytime is the result of AGW and nite, well ,the science isnt in on that yet....

Tue, 02/15/2011 - 08:51 | 962976 asdasmos
asdasmos's picture

More Critical Thinking Needed

 

Cue michael to make a passing comment that changes and obfuscates the issue at hand.

Tue, 02/15/2011 - 08:55 | 962990 More Critical T...
More Critical Thinking Wanted's picture

 

Mind pointing out in what way I've obfuscated the issue at hand?

I'm always open to a civilized discussion and I'm willing to explain/defend my position. I cited various data sources, you are free to prove the data wrong and you are free to prove my arguments wrong - and if you are right I'll (of course) admit being wrong.

 

Tue, 02/15/2011 - 08:58 | 962995 EscapeKey
EscapeKey's picture

The 0.04 figure you quoted is for the US, not globally.

Figures for low, med, and high income countries are -0.426, -0.302, -0.138.

You cherry picked the lowest number you could, and claimed it was the global figure.

Tue, 02/15/2011 - 09:14 | 963026 More Critical T...
More Critical Thinking Wanted's picture

 

(Pasting my reply from above:)

And with globally negotiated prices guess whose bid wins, yours or the guy's from Egypt?

And yes, as we've seen about 40% of a price increase and 4% of a supply/demand spread worsening we can estimate average, global inelasticity: 0.10.

 

Tue, 02/15/2011 - 09:22 | 963037 EscapeKey
EscapeKey's picture

...and now, suddenly the global elasticity has changed after you were called out.

Except, of course, from your data the elasticities are (-0.426, -0.302, -0.138) for low, med, high income countries, and your impressive math skills make the overall figure 0.10.

More fucking lies and spin. How surprising.

Tue, 02/15/2011 - 09:39 | 963080 More Critical T...
More Critical Thinking Wanted's picture

 

Hey, thanks for quoting actual inelasticity numbers.

Previously you denied that they even existed.

Now you are arguing about their level - that's progress [*] :-)

Next step for you: estimate global & supply pressures globally and transform them into food prices.

If you do it honestly then the result will likely be that current food prices are still on the low side ...

ps. you can stop blaming global food inflation on the Fed and Bernanke. Be honest to yourself and read your own numbers.

 

Tue, 02/15/2011 - 09:42 | 963097 EscapeKey
EscapeKey's picture

I base my argument on your numbers, because then you can't worm your way out of this.

Whether I believe in these (bullshit) figures, doesn't really matter with regards to this particular argument.

Anyway, lee0326, I have seen you troll reddit economics for ages - only someone with tons of time on his hands would have that kind of time to post government propaganda. Care to elaborate what you do for a living?

Tue, 02/15/2011 - 10:42 | 963295 More Critical T...
More Critical Thinking Wanted's picture

 

I base my argument on your numbers,

That's encouraging - when will we able to see your first argument as I've only seen insults from you so far.

You have not made a single testable argument of your own so far in this thread. Other than "you lie!" and "that is government data so it's falsified!".

Really, just to make sure I have just checked all your posts in this thread: not a single testable claim, only insults and innuendo.

Link me to a single sensible comment of yours.

 

Tue, 02/15/2011 - 13:05 | 963842 jmc8888
jmc8888's picture

Inelastic demand is gobbleygook.  These numbers are fluid and there has never been ONE SINGLE economic textbook that got these right...EVER.

Keep believeing in the tooth fairy. 

Relying on bunk metrics makes your conclusion...well..bunk.

Glass-Steagall

Wed, 02/16/2011 - 06:11 | 966105 More Critical T...
More Critical Thinking Wanted's picture

Inelastic demand is gobbleygook.

Yeah, like the earth being round: everyone sees that it's 100% flat, right? Whom do you believe, government satellite pictures or your own damn lying eyes?

Really, inelastic demand is a much simpler concept to grasp than the fact that the planet is round. Simple thought experiment:

Go to a deserted island with a friend and with 1 million dollars each and stay there for two months. Sorry, there's no food on the island. 2 weeks into your vacation someone will visit you guys and will sell you exactly 1 loaf of bread per week, in an open outcry auction.

I'm curious how high food prices will be on that island. I'm curious whether you will be willing to cut your demand of bread in face of clearly unreasonable prices.

Money is just a piece of paper if the other option is starvation or death.

 

Tue, 02/15/2011 - 09:02 | 963003 asdasmos
asdasmos's picture

Unless your name is michael, you are missing a piece of the puzzle.

 

However, sure, it can apply to you if you want, and from what I have seen.

Tue, 02/15/2011 - 09:03 | 963004 MsCreant
MsCreant's picture

So you are Michael?

Tue, 02/15/2011 - 12:09 | 963627 New_Meat
New_Meat's picture

He's so testy, he snapped up the wrong bait ;-)

- Ned

Wed, 02/16/2011 - 06:12 | 966106 More Critical T...
More Critical Thinking Wanted's picture

 

Uhm, yes, I indeed did :-)

 

Tue, 02/15/2011 - 14:53 | 964268 dogbreath
dogbreath's picture

Meat head!

Tue, 02/15/2011 - 08:40 | 962970 ivana
ivana's picture

this is warming up. puppeteers will make "correlation" real as soon as it suit them best. now it's "modelling" tima and response check.
expect oil spikes when food-commodity artificial rally loose steam

Tue, 02/15/2011 - 08:56 | 962993 PY-129-20
PY-129-20's picture

– 1 hr 11 mins ago

JUBA, Sudan (Reuters) – Attacks by a renegade militia in south Sudan's Jonglei oil state left at least 211 people dead, a southern minister said Tuesday, doubling earlier estimates of the death count.

"Two hundred and one people were killed and 109 were wounded. Most were civilians including women, children and priests ... and people like that," the south's minister of humanitarian affairs, James Kok, told Reuters.

Kok, who had just returned from the scene of the fighting in Jonglei's Fangak county, said an additional 10 people later died in hospital. His figures did not include casualties among the attacking militias.

South Sudan's army said forces loyal to George Athor, a former senior army officer who launched a revolt after losing in last year's elections, carried out a series of attacks in Jonglei Wednesday and Thursday last week.

It earlier said 105 people died, including more than 30 of George Athor's men. Athor was not immediately available for comment.

The violence has reignited concerns for the security of the region where voters last month overwhelmingly voted to declare independence from the north in a referendum.

French oil group Total leads a consortium controlling a largely unexplored oil concession in Jonglei.

http://news.yahoo.com/s/nm/20110215/wl_nm/us_sudan_south_clashes?utm_sou...

Tue, 02/15/2011 - 09:00 | 962998 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

YOU CAN'T INTERRUPT THE SHIPPING CHANNEL WITH JUST ONE SHIP. EITHER WAY THERE IS A CONCRETE CEILING AT 92.

 

WE ARE DUE A CORRECTION IN GOLD. LOOK FOR THE 1280 LEVEL TO BE TOUCHED VERY SOON.

Tue, 02/15/2011 - 09:07 | 963009 AGoldhamster
AGoldhamster's picture

large caps bitch

and silver > 40 within next 3 weeks

 

Tue, 02/15/2011 - 09:16 | 963017 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

CHAVEZ PUT DOWNWARD PRESSURE ON HEATING OIL GIVING IT AWAY TO AMERICANS IN NEED. (i heart that guy). CRUDE IS RESPONDING. F' WTI. IT'S IRRELEVANT ANYMORE.

 

You've probably seen the TV commercials — former congressman Joseph P. Kennedy II beckons you to enjoy reduced-price heating oil if you are struggling to keep your house warm, thanks to "our good friends in Venezuela." He then offers a few heartwarming examples of poor people who have taken advantage of the program and offers the toll free number: 1-877-JOE-4-OIL (1-877-563-4645).

Tue, 02/15/2011 - 12:14 | 963643 New_Meat
New_Meat's picture

Judy:

Kennedy and portions of the MA Congressional delegation love Chavez.  And li'l Joe is doing well by doing good, e.g.:

https://secure.pqarchiver.com/boston-sub/access/1853978671.html?FMT=FT&F...

"Smith also defended the program's ad budget as appropriate for the size of the program. And he defended Kennedy's salary - $545,000 in 2007, according to tax documents."

- Ned

 

Tue, 02/15/2011 - 09:09 | 963015 MsCreant
MsCreant's picture

Hey Judy,

Advice from my momma I think you could benefit from, keep your mouth open like that (as I can see from your avatar and the loud way you type) and you don't know what might end up in there.

Uncle Ben is just down the hall looking for any opportunity at all...

Tue, 02/15/2011 - 09:15 | 963028 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

HORDING CATS AND DRINKING BOXES OF WINE IS NO WAY FOR A PROPER LADY OF AMOUNTED AGE TO APPEAR DISTINGUISHED.

 

NOT THAT I'M BEING ACUSITORY, MADAM. JUST RANDOMLY PHYLOSOPHYSING.

Tue, 02/15/2011 - 09:16 | 963030 Lndmvr
Lndmvr's picture

Be more careful of Ben when you're walking away.

Tue, 02/15/2011 - 10:07 | 963186 tonyw
tonyw's picture

"...keep your mouth open like that..."

There's strong westerly winds there at the moment expected back to normal by Thursday, any correlation:-)

Tue, 02/15/2011 - 09:25 | 963048 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

YOU CAN NOT JUNK THE JUDGE !!

Tue, 02/15/2011 - 09:46 | 963105 Judge Judy Scheinlok
Judge Judy Scheinlok's picture

WHAT DO I LOOK LIKE SOME HTML MAGICIAN? GO CRAWL BACK INTO YOUR CAVE TRI-CLOPSE, AND LEAVE THE GOOD JUDGE ALONE.

Tue, 02/15/2011 - 10:22 | 963217 Ben Probanke
Ben Probanke's picture

Suez is cleared.. always have ships running aground.. nothing special and all is back to normal allready

Tue, 02/15/2011 - 20:54 | 965454 co2010
co2010's picture

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