In the Panama Canal, ships are lifted 26 meters by locks. The significant majority of this height is simply to avoid having to dig 26 meters more down for the entire length of the canal. (Just because the Isthmus of Panama is narrow, it doesn’t mean it is all at approximately sea level. It isn’t.) Digging the canal was “one of the largest and most difficult engineering projects ever undertaken” according to wikipedia, even at the depth it was dug. Making this work requires a water source 26 meters above sea level (to fill the locks) which obviously exists in Panama. In contrast, the Suez Canal is all at sea level and it was feasible to make it that way.
The Suez Canal was dug through mostly flat desert, so the canal could be kept at sea level.
The French tried to build the Panama Canal at sea level but massively underestimated the terrain and dangers of the environment which lead to huge cost overruns and an estimated 22,000 deaths from tropical diseases before the project was abandoned.
When the Americans came along they built dams to create a huge artificial lake in the middle feeding locks which brought ships up to its level. They also identified mosquitos as the main carriers of disease, clearing jungles and draining swaps around construction sites.
While the terrain other posters mention is the main reason, there’s another significant factor – direction. The Panama Canal connects two bodies of water that are East and West of each other, while the Suez connects two bodies of water that are north and south of each other.
The worlds tides are caused by a “bulge” in the water levels around the world. The moon’s gravity pulls on the water making the water into an oval around the planet. Picture a balloon that you are squeezing just a little bit – it’s a little smaller where your fingers are, and a little bigger on the sides. This oval rotates around the planet with the moon causing water levels to rise and fall at all longitudes at the same time (approximately- there is a lot of variation due to land shape, but this is ELI5).
Because the Suez connects two seas that are north and south of each other, their tides are similar enough that the water doesn’t try and rush through the canal every few hours, where as the Panama would be a be a white water rafting river if the elevation change and locks didn’t prevent significant water movement.
Short version:
Panama has many mountains and the ground is full of rock It is very difficult to dig through. So they use a large lake for big parts of the distance. The lake is higher than the ocean becaus it is basically a mountain valley filled with water. You want to keep the lake from draining into the ocean but you still want to move boats from the ocean to the lake and from the lake to the ocean. You build canal locks to do that. You also need to dig less deep into the mountain now because you only need a dig down to the level of the lake and not all the way down to the sea. You have to dog less in hard rock. You are happy and save money.
The area of the Suez Canal area is basically flat and full of sand. There’s also a lake. The lake is (essentially) at the same level as the sea is. You can dig straight ahead without worrying about draining the lake. You don’t need a water lock. Boats can go through the canal faster because they don’t have to wait for the canal locks. Ship Captains are happy because they can get to their destination earlier. You are happy because you can get more boats through per day and earn more money
Maybe [this](https://www.snowtao.com/cruise/Panama/art/panamap.jpg) link will help to illustrate it the Panama side of things.
More information:
I’ve read here a few times that one ocean is much higher than another. The statement that one ocean is at a higher level than another is very misleading and not really true. They might be in reference to the MSL (median sea level). But the MSL is not the actual zero height everywhere because there are (veeeery slight) differences in gravitation depending on where you are on the earth. So if it really depends on what you define as zero height.
Water distributes itself equally according to the gravitational potential of the earth (called the “reference ellipsoid”. There are different versions of it and they are very important today because they are an integral part of GPS and other satellite navigation systems). In this case water will never flow from one ocean to another because the water already had millions of years to get to a state of equilibrium after a change.
For example before the straight of Gibraltar opened up the Mediterranean was not what it is today until one day it broke open and a ridiculous amount of water flowed into what is now the Mediterranean.
But after some time the water settles and there is no more water flowing and the new sea is at equilibrium with the gravitational potential. So even if you dig a canal (like the suez canal) there won’t be any water flowing because the red sea and the Mediterranean are already connected through the Atlantic and indian ocean. They are all at the same level relative to the gravitational potential, the “reference ellipsoid”.
People got this wrong for quite a long time. Even the french, during napoleon’s campaign in Egypt wanted to dig the Suez Canal but were actually worried of different heights of the the red sea and the Mediterranean. And some of his best scientists and engineers said that it is too dangerous to do so. So they didn’t. Back then a (now exceptionally famous) scientist called Joseph Fourier already told them that such a thing would never happen according to gravitational potential theory. They dismissed him. Later they proved he was right and dug canal anyways.
Now why is there still a flow through such canals !? Because the oceans are not at rest and the moon and the rotation of the earth and the moon around a common center of gravity and the sun all create tides. And because water sloshing around has it easier sloshing through a big space like the Atlantic compared to a small space like the Suez Canal or Gibraltar, the tides that arrive are delayed and flow at different speeds to different places (Imagine moving around in your bath tub. Water flows very easily in through the wide part, but it takes some time to flow past you to the other end). Thats why you temporarily have different heights in different oceans.
But you cannot drain an ocean by connecting it to another ocean.
The only way to achieve a different water level relative to the gravitational potential is by disconnecting a body of water from all the seas and then adding water to it. That is essentially what happens with lakes (such as the aforementioned lake in the Panama Canal). They are basically a large bowl of water sitting higher than sea level.
Thats why canal locks are always used to get to a different height, or protect a canal or lake from tides, or prevent a lake from draining, or prevent the mixing of salt and sweet water or such things.
Reason 1: connecting the Caribbean and the Pacific even directly would require locks because of sea level difference and tides. This is actually what the French plan for the canal had been.
Reason 2: when the French plan failed (from a lot of people dying during the excavation from malaria and other tropical diseases), the US eventually took on the project and decided that instead of digging a trench straight through a mountain range covered in rain forest and prone to landslides when destabilized by digging, they’d just go over it. So both sides of the canal go up to Gatun Lake (an artificial lake they made) which is 26 meters above sea level.
They still dug through lots of mountain, but the elevation significantly lessened the risk of landslide and allowed for pathing around some of the worst parts. The Suez didn’t have to deal with this because it’s mostly flat
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