The total impact of the Suez Canal disruption on U.S. companies will cost up to $45 billion in negative economic impacts in Q2, according to ClearPrism.
“The economic impact due to the one-week disruption of oil alone, just one of the 10 commodities held up in the Suez Canal, will cost up to $28 billion in the coming quarter,” says Ralph Welborn, co-managing partner, ClearPrism. “While most analysts will be projecting something in the neighborhood of a $10 billion impact from disruption in the oil industry, our data shows it will actually be almost triple that. Understanding and predicting these ripple effects in downstream industries is critical as companies adjust strategically, not just react to the immediate pressures they are under.”
From PR Web:
- ClearPrism reports the canal blockage will affect approximately 25% of the U.S. gross domestic product (GDP) value, and the ripple effect will result in impacts on another 15%.
- Using a unique artificial intelligence algorithm and analytics approach, the company assesses economic impacts through each step of the U.S. supply chain of impacted industries of products blocked at the canal such as oil and products, fertilizers, chemicals, fabricated metals and vegetable oils.
"All supply chain disruptions have industry-to-industry as well as industry-to-geo and geo-to-geo ripple effects," says Welborn. "There are immediate effects and longer-term effects, depending on what we call 'hops' across industries. Such insights into these types of 'hops,' and the relative quantitative dependency among them, is critical to understanding the economic and production impacts of the key products that were blocked in the canal and mitigating for future events.”