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DETERMINING
the true nature of the oil price plunge
- is it chronic or a hiccough? - has made
it hard to determine trends in the Asia-Europe
trade.
One
big surprise came in January with the failure
of UN's emission control areas (ECAs) crisis
to have an impact. It was widely expected
to increase bunker costs 50 per cent in
the English Channel, the North and Baltic
Seas as well as the entire North American
coast except for Mexico.
Which
it did - but with crude falling 54 per cent,
it hardly mattered. While there has been
rebound since, many feel "black gold"
has lost its lustre now that so many countries
sprout oil these days.
While
many fears were eliminated, so too were
countervailing strategies to be deployed
after the low-sulphur fuel crisis hit.
Some
countervailing schemes were delightfully
sneaky, like the Port of Gothenburg's plan
to capture most of Sweden's forest product
trade by taking advantage of the harbour's
comparatively low exposure to ECA routes
before ships reached the freedom of the
high seas.
The
Gothenburg scheme would take advantage of
the supposedly severe impact the low-sulphur
fuel mandate would have on the Baltic, obliterating
a thriving short sea trade to its northernmost
ports. Because ships going north went deadhead,
and only returned with payload, it could
not long survive with the new fuel rules.
Or so it seemed before low oil intruded.
Doing
the math with historic prices, Gothenburg
prepared itself for what was considered
an inevitability, and built new cargo consolidation
docks and new freight handling facilities
and relied on under-used rail and road capacity
to deliver the goods cross country for worldwide
export. But low-oil ended that, for the
moment at least.
Then
there is the US$12 billion Helsinki-Tallinn
tunnel project whose utility is doubtful
if oil prices remain low. A feasibility
study for a 105-kilometre tunnel between
Helsinki and the Estonian capital of Tallinn
has just been done. It would avoid the same
costly sea route to get its northern lumber
resources south by road and rail, bypassing
Russian territory by going under the Gulf
of Finland. Strategic reasons, given diplomatic
difficulties with Russia, still stand, but
crucial economic imperatives have disappeared
in the wake of low-oil.
But
European northern activities are dwarfed
by initiatives from the Mediterranean to
the Black Sea, where warlike Islamicists
and Russians make the application of rules
for things as arcane as carbon footprints
problematic.
It
is here, in the Med Free Zone, where there
is no ECA, that more wide-ranging initiatives
are taking place, but again - because of
the fall in oil prices - each one has been
stripped of its urgency.
What
these ports on the north side of the Med
and Black Sea have come to represent is
an attack on the dominance of the Northern
Range ports - Le Havre, Rotterdam, Antwerp
and Hamburg, as well as lesser ports of
Zeebrugge, Bremerhaven and Gdynia.
Anyone
looking at a map of Europe can be forgiven
for assuming that ships going through the
Suez Canal would naturally discharge their
Asian cargoes at any number Mediterranean
or Black Sea ports to access the north continent.
It is unquestionably the shortest of routes
as the crow flies.
It
is certainly counterintuitive to think that
these ships would pass these Med ports,
sail by Gibraltar into the Atlantic, go
around the Iberian Peninsula, across the
stormy Bay of Biscay and to discharge cargo
at Northern Range ports of Le Havre, Rotterdam
and Hamburg. But that's what happens.
Of
course, it isn't as silly as it seems -
or wasn't until various shipping developments
tended to undermine logic that underpins
the Northern Range doctrine. But again that
potential reversal has itself been threatened
with reverse in recent months by low oil.
With
the Russian ethnic insurgency, the growth
of Odessa has been stunted, but as late
as last August, a 9,400-TEU ships called
at the port. With any luck, the argument
is likely to be resolved in time.
Once
resolved, the northern Black Sea ports can
resume their albeit more limited role in
supplying Asia goods northward rather than
being recipients of overland imports from
the west and north.
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