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Suez Canal blockage could cause problems for the globe: Here’s what you need to know

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The behemoth cargo ship stuck in the Suez Canal and blocking traffic in one of the world’s most important maritime trade chokepoints isn’t set to break free just yet.  

The Ever Given, a 220,000-ton mega ship nearly a quarter-mile long with a 20,000 container capacity, ran aground after being blown by strong winds while entering Egypt’s Suez Canal from the Red Sea. It’s completely blocked the passageway that is home to as much as 12% of the world’s seaborne trade and through which 50 container ships normally transit per day.   

Tugboats and dredgers are currently working to dislodge the ship, which has been stuck since Tuesday evening. But the operation could take weeks, one of the executives involved has warned.  

“While we believe and hope the situation will get resolved shortly, there are some risks of the ship breaking,” JPMorgan strategist Marko Kolanovic wrote in a note Thursday. “In this scenario, the canal would be blocked for an extended period of time, which could result in significant disruptions to global trade, skyrocketing shipping rates, further increase of energy commodities, and an uptick in global inflation.”

Stranded container ship Ever Given, one of the world’s largest container ships, is seen after it ran aground, in Suez Canal, Egypt March 25, 2021.

Suez Canal Authority | Reuters

The crisis is another blow to the global supply chain after a brutal year ridden with delays, shortages and price squeezes on the back of the coronavirus pandemic.   

What does this mean for global trade?

The shipping delays could impact everything from the clothes and shoes you ordered online to gym equipment, electronics, food, and energy supplies — meaning gas prices could get higher, too.

“Suez Canal container blockage to further rattle global supply chains, to drive pricing higher given pent-up demand,” analysts at JPMorgan said in a research note Thursday.  

The man-made Suez, at 120 miles long, is a key transit point connecting East to West. And the 20,000 ships that pass through it yearly transport everything from oil and gas to machine parts and consumer goods. 

While it’s still early to say what the full impact of the tanker crisis will be, the bank expects that in the near term, “the blockage is likely to add to industry supply strains, which are already hampered by ongoing supply chain bottlenecks” in the form of port congestion and shortages of both vessels and containers due to Covid-19.  

Ships are going to have to shift to entirely different routes, “will result in longer voyage times and causing further delays,” JPMorgan wrote. 

And those delays could be more than 15 days for many ships, whose alternative is sailing around the Cape of Good Hope at the southern tip of Africa, which analysts say would increase shipping times by up to 30%.  

“The immediate impact of delays in the canal will centre on European – Asian trade, adding delays to already disrupted supply chains affecting oil and refined products’ supplies,” ING senior economist Joanna Konings wrote in a client note Wednesday.  

Impact on crude prices 

The Ever Given’s misfortune has already impacted oil prices.  

News of the Suez blockage drew in buyers, and along with other economic data contributed to international benchmark Brent crude‘s one-month futures contract gaining “its biggest one-day gain in nearly a year to close at $64.41” on Wednesday, according to Arctic Securities, though it lost some of those gains by Thursday. 

In the meantime, between 5% and 10% of all seaborne oil is transported through the Suez, meaning that for each day that the ship remains stuck, it delays the shipment of another 3 million to 5 million barrels of oil per day. Several tankers carrying jet fuel and gasoil are also held up on the Persian Gulf-Europe route, as well as empty tankers crossing to pick up North Sea oil, S&P Platts reported Thursday. 

A graph showing shipping traffic halted around the Suez Canal after the ship Ever Given began wedged in the canal.

Source: MarineTraffic

The canal is also a transit point for around 8% of global liquefied natural gas (LNG), and a prolonged disruption could impact flows to primarily the European market.  

Any price effect will likely be brief, however, says Peter Sutherland, president of Houston-based energy investment firm Henrietta Resources.  

“It won’t have a lasting impact on prices, but it will help lend support in the run-up to the OPEC+ meeting,” Sutherland told CNBC.  

“The risk premium in oil markets will likely be short-lived, but the canal back-up still managed to shift the market narrative.”

The winners

The canal blockage is certainly not bad news for everyone — spot freight rates are set to jump even higher on pent-up demand, making money for the operators, market watchers say. 

“A more prolonged closure of the Suez Canal would see container shipping as the biggest beneficiary, while tanker, dry bulk and air cargo might also see some higher rates,” wrote JPMorgan, describing the tightening of shipping rates “as a upside risk.”

Satellite images of container ship Ever Given stuck in Egypt’s Suez Canal.

Source: European Space Agency Sentinel-2 Satellite

Who is set to benefit most? JPMorgan highlights Asian liners, saying that despite higher bunker costs due to longer rerouted journeys and increased congestion, they expect higher spot freight rates. “This instead of hurting profitability is expected to be positive for bottom-line for Asia liners, in our view,” the bank wrote.

Bank of America’s analysts agree. “A Suez closure of a few weeks would be very positive for spot freight rates — by effectively removing supply by adding 20-30% to sailing distance via Cape of Good Hope,” it wrote in its note Thursday.

Risks and vulnerabilities grow

In the meantime, the Suez Canal’s blockage “will add to an already rising Middle East risk premium for oil and refined products,” Torbjorn Soltvedt, principal MENA analyst at Verisk Maplecroft, said, highlighting increased risk of attacks on oil facilities amid regional tensions.

The uncertainty over the blockage’s duration “creates a window of opportunity for state and non-state actors seeking to maximize the impact of attacks against tankers and energy infrastructure in the Persian Gulf and Red Sea,” he warned.

Cargo ship “Ever Given” stuck and blocking traffic in the Suez Canal

Source: Reuters

Most analysts expect the situation to be cleared within the week. But “the disruption could be prolonged if there are complications or hull damage,” Bank of America wrote Thursday. When the traffic eventually gets cleared, ships will be arriving at their ports behind schedule, creating yet more congestion. 

Still, the bank writes, “a blockage of a few days would be broadly manageable to the container shipping industry — perhaps involving additional fuel cost as shipping companies speed up their services to make up lost time.” 

The whole fiasco underscores just how fragile the trading network that the world relies on really is, says Sutherland. 

“Paired with the recent attacks on Saudi installations, it’s a reminder of the many vulnerabilities in the global oil and gas supply chain.”

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Source: https://www.cnbc.com/2021/03/25/suez-canal-cargo-ship-blockage-could-cause-problems-for-the-globe.html

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The Nanit Pro baby monitoring system is $100 off at Amazon

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All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.

If you’re in the market for a baby monitor, there are a lot of options to choose from. Nanit’s Pro Complete Baby Monitoring System consists of a 1080p camera that provides a bird’s eye view of your child’s crib, a stand, a Breathing Band for your child to wear and a Smart Sheet for their mattress. The whole set is currently $280 on Amazon, which is $100 off its regular price. The Nanit Plus camera and stand is also on sale for $50 off. 

Buy Nanit Pro baby monitor at Amazon – $280Buy Nanit Plus Camera + Stand at Amazon – $250

The Nanit Pro system was a “best overall” pick in our baby monitor guide for several reasons: the camera provides a livestream that is clear day or night, it loads quickly and since it hovers over a crib it doesn’t need to be tilted or adjusted after its initial set up. The camera feed is accessed via a mobile app, which can be shared with multiple caretakers. It also provides additional features like motion and sound alerts, background audio (which plays the feeds audio over other apps), a microphone and a Memory feature which replays highlights from the previous evening. The one thing we didn’t like about the camera in testing was the stand which seemed a bit wobbly.

The Breathing Band is strapped around a baby’s midsection and works with the app and camera to track breaths per minute. Nanit also sells the patterned wearable in a swaddle or a sleeping bag version. The Smart Sheets work with the camera to calculate your child’s height, by triangulating points on your baby using a photo of them laying on the sheets. Both products worked well during our testing, but are single-function devices in that they only measure the one aspect.

Follow @EngadgetDeals on Twitter for the latest tech deals and buying advice.

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Source: https://www.engadget.com/nanit-pro-complete-baby-monitoring-system-is-100-off-at-amazon-203859732.html

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Spot gas shortages could worsen if Colonial Pipeline doesn’t reopen by the weekend

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Image showing the Colonial Pipeline Houston Station facility in Pasadena, Texas (East of Houston) taken on May 10, 2021.

Francois Picard | AFP | Getty Images

If the Colonial Pipeline is not back in business by the weekend, prices could continue to rise at the pump and there will be broader localized fuel shortages across the southeast and mid-Atlantic regions.

Gasoline stations that could not get enough fuel were already closed in some states, and prices jumped overnight, by as much as 10 cents or more per gallon in some areas.

“This turns into a crisis by the end of the week, if it’s not resolved, particularly with Memorial Day coming,” said John Kilduff, founding partner of Again Capital. “People are going to start topping off their tanks.”

It’s not that there’s not enough fuel. There’s plenty in the refining centers on the Gulf Coast.

The issue is that gasoline, jet fuel and diesel are stuck in the wrong places. Moving it requires a hodgepodge of solutions, and analysts say it will be impossible to meet demand without the pipeline.

Colonial Pipeline attack

Colonial Pipeline stopped operations Friday and notified federal officials that it was the victim of a ransomware attack. The attack, carried out by a criminal cyber crime group known as DarkSide, resulted in the shutdown of 5,500 miles of pipeline. The artery supplies half of the gasoline to the east coast and runs from Texas to New Jersey.

The pipeline company said it expects to restore a substantial amount of operations by the end of the week, but how much is not clear. U.S. Energy Secretary Jennifer Granholm said federal agencies are working around-the-clock to help the pipeline return to normal operations.

The shutdown arrives at an inopportune time: The beginning of what could be a record summer driving season as Americans make up for last year.

“Given the size and the direction of the pipeline and the market that it feeds, the Colonial Pipeline is the single most important artery moving refined products in the country,” said Michael Tran, energy analyst at RBC. “This is already an earthquake and the magnitude of the earthquake just grows by the day.”

Prices inch upward

The national average for a gallon of unleaded gasoline jumped to $2.985 Tuesday, an increase of 6 cents in the past week, according to AAA.

Regionally, however,the price increases were sharper, AAA found. In South Carolina, for instance, gasoline prices were up more than 6 cents since Monday and 13 cents in the past week. In Georgia, drivers were paying $2.87 per gallon Tuesday, an increase of of more than 10 cents in just one day and 17 cents in a week.

A rise of 3 more cents per gallon would put the average U.S. selling price at the highest level since November 2014.

“We are seeing the full fledge panic at the moment in some of the places I suspected we might see it,” said Tom Kloza, head of global energy analysis at OPIS. “There aren’t enough drivers to take trucks from terminals that have gasoline to stations. We are seeing a lot of stations running out. Georgia seems to be ground zero.”

Kloza said he expects gasoline prices to rise, but not spike wildly higher. The bigger issue is that gasoline will be in short supply in the region, since it takes time to replace once the pipeline is switched on and outages could continue.

Gasoline in the pipeline travels at just 5 miles per hour.

This turns into a crisis by the end of the week, if it’s not resolved, particularly with Memorial Day coming.

John Kilduff

founding partner of Again Capital

According to GasBuddy, 7.6% of the gas stations in Virginia were out of fuel Tuesday afternoon, while 7.5% of stations in North Carolina have run dry. The impact on gas stations in other states along the pipeline was lower though 5.2% of Georgia stations were out of fuel.

GasBuddy also notes that gasoline demand on Monday in five key southeastern states was 40.1% greater than it was on the prior Monday. Those states are Georgia, Florida, South Carolina, North Carolina and Virginia.

“Gasoline demand as a whole was up 20%” for the U.S. on Monday, according to Patrick De Haan, head of petroleum analysis at GasBuddy. De Haan said for each day the pipeline is down, it takes five to seven days to return to normal.

“Refiners are starting to book tankers to store product off shore because it’s backing up in the system,” said Kilduff.

“You have a weird kind of problem,” he added. “U.S. Gulf Coast refinery operating levels are at record highs. They were over 90%. They have the opposite problem. There’s a surfeit of supply building in the Gulf Coast region.”

Some refiners, like Motiva, have already cut back runs.

Alternative ways to transport gas

Again Capital’s Kilduff said traders are watching to see if the U.S. will waive the Jones Act to allow non-U.S. ships to transport gasoline to U.S. ports.

Under the Jones Act, a U.S.-flagged ship must be used to transport goods from one U.S. port to another, but in an emergency, refiners could seek a waiver so they could ship fuel to the southeast ports.

The New York region could be spared the worst of it, since it is served by Philadelphia and New Jersey refineries, and there are increased shipments of gasoline from Europe already booked for the U.S,. said Kilduff.

“There’s bookings out of Europe to come to the U.S. That’s why we’re seeing pressure on gas prices,” said Kilduff, noting RBOB gasoline futures were barely higher. Futures had initially jumped on concerns about shortages, but had given back most of their gains. Jefferies noted that at least six tankers were booked to ship gasoline from Europe.

Currently, more fuel is being moved by truck. Truckers have been given temporary hours of service exemptions, but Kloza of OPIS said the problem of too few truckers is an issue for the effort. The lack of truckers had already been straining supply in some areas.

“To put it in perspective, if a tanker truck can hold 250 barrels of gasoline and the Atlanta area consumers need over 200,000 barrels of gasoline, you need more than 1,000 trucks a day,” said Andy Lipow, president of Lipow Oil Associates.

Lipow said that also doesn’t solve the supply problem for diesel-fueled trucks or the issue airlines face if they can’t get jet fuel. The pipeline carries 1.5 million barrels a day of gasoline and about 1.2 million barrels of distillates, which includes diesel and jet fuel.

“Jet fuel is a concern because it’s only stored at airports. They’re at risk of running out of jet fuels and airlines have to make alternative plans, loading up aircraft before they fly into those airports, making sure they have supplies before they go to their next destination,” Lipow said.

American Airlines said the impact so far was minimal, but that it was adding stops to two long-haul flights from Charlotte to conserve fuel at the North Carolina hub.

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Source: https://www.cnbc.com/2021/05/11/colonial-spot-gas-shortages-may-worsen-if-pipeline-doesnt-reopen-soon.html

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Ubisoft’s oft-delayed ‘Skull and Bones’ won’t come out before 2022

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Skull and Bones will miss its previous release date once again. Ubisoft says it now expects to publish the pirate game sometime between during its 2022-2023 fiscal year, which runs from April 1st, 2022 to March 31st, 2023. For those keeping track, this is the fourth time Ubisoft has delayed Skull and Bones. Following a reveal at E3 2017, the company initially planned to release it in 2018. It then went on to push back the game to 2019, mid-2020, 2021 and now 2022.

Last year, Elisabeth Pellen, the game’s creative director, attributed the ongoing delays to a vision change. Initially, the premise of Skull and Bones was simple. It was supposed to adapt the ship battling mechanics from Black Flag for multiplayer and strip all the narrative threads that make the Assassin’s Creed franchise hard to follow. Things have changed since then. “The answer is that we simply needed more time. We dreamt something bigger for Skull and Bones, and these ambitions naturally came with bigger challenges,” she wrote at the time. “As Skull and Bones evolved from its original idea to what it is now, it was also necessary to have some fresh eyes join the team.”

In the meantime, Ubisoft fans can look forward to playing some of the company’s most popular games on new platforms. In the same earnings report, the company said it would release Rainbow: Six Siege and For Honor on Stadia before the end of June.

All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.

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Source: https://www.engadget.com/ubisoft-delays-skull-and-bones-2022-201006927.html

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TikTok is reportedly testing a job recruitment tool

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TikTok’s about much more than showing off killer dance moves or sharing cleverly edited videos. Some creators are offering career advice and, soon, you might be able to find a job through the platform.

The service is testing a recruitment tool, according to Axios, to help people find jobs and companies, recruiters and brands to unearth solid candidates. Engadget has contacted TikTok for more details.

The feature reportedly won’t be baked into the core TikTok app. It’s said to be a webpage where job listings are posted, most of which will likely be entry-level positions. Since this is TikTok, you’ll be able to post a video resume rather than a boring old written one, according to the report. You might be able to add your resume video to your profile as well.

Given how much time many young adults spend on TikTok, it could be a great way for brands to reach the people they’re looking to hire. On the other hand, we could see more instances of people losing out on jobs over ill-advised posts if companies take a close look at their TikTok accounts. So, it’s maybe worth setting up a secondary account for professional purposes, depending on what kind of job you’re looking for.

All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.

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Source: https://www.engadget.com/tiktok-job-recruitment-tool-report-191359350.html

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