LONDON (BLOOMBERG) – The Rhine River on Friday (Aug 12) is set to shrivel to a crucial level that could upend the trade of fuels throughout Europe, with the effects potentially rippling through the continent for months.
The water level at Kaub – a key waypoint west of Frankfurt – is poised to breach 40cm and continue dwindling in subsequent days, according to German government data.
Below that marker, it’s not economical for many barges to transit the river.
The Rhine is used to ship everything from fuels to chemicals, paper products to grains.
The climate crisis on the river couldn’t happen at a worse time, with Europe already in the grips of an energy supply crunch in the wake of Russia’s war in Ukraine.
The twin crises have sent costs soaring for businesses, undermining efforts to tame inflation.
The trade of 400,000 barrels a day of oil products could be disrupted along the river that stretches from the Amsterdam-Rotterdam-Antwerp region through Germany to Switzerland, according to Facts Global Energy.
In Germany, companies have been taking steps to prepare.
Chemical maker BASF SE is using more rail to transport goods and has ordered shallow-water barges.
While there’s no impact currently, the company has said it can’t rule out a reduction in production rates for some plants in the coming weeks.
Utility Uniper SE said Thursday it won’t be able to bring enough coal by train to run its plants at full capacity for a longer period of time. It previously warned of production cuts at Staudinger-5 plant into September due to lack of coal.
Steelmaker Thyssenkrupp AG has said its crisis team is meeting daily, and it’s using ships with lower drafts to keep its mill in the town of Duisburg supplied.
If the disruption continues into September, there could be an increase in demand for trucking to transport goods across Germany, according to Simonas Bartkus, head of marketing and communication at Girteka Logistics, the owner of Europe’s largest fleet of trucks.