The Suez Canal Blockage: Can the Carrier Recover the Increased Shipping Costs Caused by Rerouting?
When the Ever Given, a large container ship, became lodged in the Suez Canal in March 2021, it blocked one the world’s busiest maritime routes for several days. This incident led to a significant disruption in global trade, as hundreds of ships were delayed or forced to reroute around the southern tip of Africa instead of passing through the canal. Rerouting around the southern tip of Africa, known as the Cape of Good Hope route, can add approximately 7 to 10 days to a ship’s journey. This longer route increases fuel consumption and operational costs. Can the carrier recover the increased shipping costs from the charterer? This question is analyzed in this article.