Water levels at the freshwater lake that fuels operations at the Panama Canal have been kept at historically high levels in preparation for shifting weather phenomena likely to take place later this year.

The latest forecast from US National Oceanic and Atmospheric Administration (NOAA) shows a 98% probability of an El Niño forming near the end of the year, as shown in the following chart.

El Niño, which is a recurring climate pattern that is characterized by warmer than normal water in the eastern and central tropical Pacific, tends to result in increased vertical wind shear, which is unfavorable for Atlantic hurricane formation and intensification and is important for predictions during hurricane season.

But El Niños can lead to reduced rainfall around Panama, which in the past has contributed to lower water levels in Gatún lake.

The Panama Canal Authority (PCA) has been preparing for various scenarios surrounding El Niño to try and mitigate its effects.

This included maintaining the water level at Gatún lake at historically high levels.

The following chart shows the PCA’s water level projections for the next month.

“In light of the potential threat of an El Niño event in the second half of 2026, the Panama Canal began implementing water-saving measures at the locks in late 2025 and took advantage of the season in 2026, which was among the wettest on record since 1950, to strengthen water reserves in Gatún and Alhajuela lakes,” the PCA said.

The PCA is also looking at steps it can take in 2027 because history indicates that the most pronounced impacts of moderate or strong El Niño events tend to be reflected more clearly in the subsequent year, as was the pattern in 1982-1983, 1997-1998, 2015-2016, and 2023-2024.

WATER-SAVING MEASURES
The PCA has activated preventive water-saving measures, drawing on the experience gained during previous droughts, which made it possible to consolidate effective operational practices for water resource management.

“These actions are intended to anticipate scenarios in times of reduced water availability and to optimize use of water in operations,” the PCA said.
These steps included:
• Simultaneous lockages, which is a process that allows two small ships to transit through a single lock at the same time, whenever vessel dimensions allow, to reduce the total volume of water used.
• Use of water-saving basins at the Neopanamax locks during vessel directional changes, saving one cubic hectometer of water daily.
• Use of interior gates, which reduces the volume of water needed to fill the chambers, according to vessel length.
• Temporary suspension of hydroelectric generation at Gatún, which prioritizes water storage for human consumption and canal operations.

LONG-TERM MEASURES
While operational measures make it possible to optimize the use of available water and have proven effective in addressing periods of reduced water availability, the sustainability of the Panama Canal and the water supply for the population require long-term structural solutions, specifically the Río Indio Project, a key component of the country’s water security strategy.

This project will expand the water storage capacity of the canal system, strengthen resilience in the face of more frequent and intense droughts and ensuring both reliable canal operations and the supply of water for human consumption.
“Río Indio responds to a comprehensive vision of water resource management which is designed to anticipate the effects of climate change and protect a vital resource for Panama and global trade,” the PCA said.

The US is the largest user of the canal.
In 2024, 52% of transits through the canal had ports of origin or destinations in the US. More than 76% of the cargo that transited the canal had the US as its origin or destination.

The Panama Canal remains the primary route for trade between Asia and the US Gulf and East Coast.
Source: ICIS by Adam Yanelli, https://www.icis.com/explore/resources/news/2026/05/19/11209064/panama-canal-plans-for-water-shortages-as-us-noaa-forecasts-98-chance-of-el-nino/