LNG vessels transits through Suez Canal under the changing geopolitical context

Abstract

The aim of this paper is to investigate the impact of geopolitical events to the LNG transits through the Suez Canal. This paper examines the effects of the Russian invasion to Ukraine, and the following EU measures referring to energy independence from Russia, as well as the tensions in the Middle East. We have identified that the Russian invasion to Ukraine and the Houthi’s attacks on commercial vessels, affected the seaborne trade of LNG. In the first case we observe increase in the LNG transits via Suez, while in the second case an opposite effect is observed. Our results reveals that the impacts of both cases became obvious 7 weeks following the initial events. It should be highlighted that the Houthi’s attacks on commercial vessels in the Red Sea had greater magnitude in absolute terms, compared to the Russian invasion. Our study is useful for several LNG suppliers and deliveries both in Europe and Asia who utilize the Suez Canal.