The Panama Canal, a major maritime trade route, is facing a reduction in ship crossings due to a severe drought. The Panama Canal Authority (ACP) will decrease the daily booking slots from 31 to 25 starting November 3, with further reductions to 18 slots by February 1. The decrease is necessary due to declining water levels in Gatun Lake, the main reservoir used for ship transportation. The drought is attributed to the El Nino climate pattern and delayed rains. As a result, there have been long delays in transit, impacting shipping rates and increasing costs for liquefied gas transporters.
| Signal | Change | 10y horizon | Driving force |
|---|---|---|---|
| Reduction in daily ship crossings due to severe drought | Decrease in ship crossings | Further reduced ship crossings | Severe drought and water scarcity |
| Booking slots cut to 25 per day starting Nov. 3 from an already reduced 31 per day | Further reduction in booking slots | Reduced availability of booking slots | Severe drought and water scarcity |
| Water levels in Gatun Lake at unprecedented low levels for this time of year | Unprecedented low water levels | Possible water shortage and restrictions throughout the year | Severe drought and water scarcity |
| El Nino climate pattern contributing to Panama’s drought | Climate pattern affecting rainfall | Impact on rainfall pattern in Panama | El Nino climate pattern |
| Existing restrictions causing long delays and higher shipping rates elsewhere | Increased shipping delays and costs | Continuation of shipping delays | Existing restrictions and reduced capacity |
| Delays at the canal pushing up the cost of shipping liquefied gas from the U.S. | Increased cost of shipping liquefied gas | Increased shipping costs for liquefied gas | Delays at the canal and reduced capacity |