The Panama Canal, a vital waterway through which about 5% of global trade flows, will reduce ship traffic starting this Friday for the second time in its history. The move is due to a drought caused by the El Niño weather pattern, which has led to lower rainfall and higher temperatures in Central America. The Canal Authority (ACP) plans to gradually cut the number of daily transits from 36 to 32 ships, aiming to conserve fresh water needed for the canal’s operation. Additionally, the maximum depth of ships allowed through the canal will be reduced from 15.24 meters to 14.63 meters. Panama has declared a state of alert due to the El Niño phenomenon, which is affecting several countries in the region. The Panama Canal, which is 80 kilometers long, relies on rainwater stored in two large artificial lakes, Gatun and Alhajuela, to operate its system of locks. These locks raise and lower ships to cross the isthmus between the Atlantic and Pacific Oceans. Each ship requires about 200 million liters of fresh water to pass through the locks, which can lift vessels up to 26 meters above sea level. According to Erick Cordoba, head of hydro-meteorology for the canal, the region has experienced a 35.8% drop in rainfall compared to historical averages from April to August. He noted that there is "no sign of improvement in the short term." The Panamanian government predicts that the 2027 dry season, typically between January and April, may begin earlier and extend until May, potentially leading to further restrictions. If the lakes are not filled by November, former canal administrator Jorge Quijano warned, "we will have to tighten our belts." In 2023 and 2024, El Niño had already forced the canal to reduce daily transits to 22 ships and lower the maximum draft to 13.41 meters. This led to a 20% drop in the number of ships and a 17% reduction in tonnage, along with long waiting times for passage. Between October 2024 and September 2025, approximately 13,400 ships passed through the canal, transporting 489 million tons of goods and generating about 4.9 billion euros in revenue. If restrictions continue, shipping costs and waiting times may rise, potentially affecting the prices of goods, according to Rebecca Bill Chavez of the Inter-American Dialogue. Quijano noted that each 30 centimeters decrease in draft reduces a ship’s capacity by about 200 containers. Large ships can carry up to 16,000 containers, and the impact on the container sector could be significant. The Danish shipping company Maersk says it is too early to speculate on the full effects of the current climatic conditions. The canal is primarily used by ships connecting East Asia to the U.S. East Coast, and traffic has increased since the start of the war in the Middle East. Analyst Natasha Lindstaedt from the University of Essex warned that rising costs could affect U.S. trade. In response to the drought, the ACP plans to build a new reservoir covering 4,600 hectares on the Indio River, west of the canal, to ensure a steady water supply for both the canal and Panama’s population of 4.6 million people. However, the project is not expected to be completed before 2031.