Europe is experiencing its worst drought in 500 years, according to Xclusiv Shipbrokers.
The River Rhine, connecting German and Swiss industry with Rotterdam, Europe’s largest port, is set to shrink significantly, which could severely restrict the flow of coal, fuels, and other commodities for months, increasing the prices of EU natural gas to above Euro /MWh, not far from an all-time high of Euro 300 hit in March.
Specifically, the water level at Kaub, a key waypoint west of Frankfurt, is expected to fall at 33 cm and drop further in the following days. Most barges hauling goods, from diesel to coal, are incapable of transiting the river below 40 cm. Although those goods could be transported either by road or rail, the cost is much higher.
