An 'unprecedented drought' is affecting the Panama Canal. El Niño could make it worse.

An "unprecedented drought" is affecting the Panama Canal's water supply and leading authorities to impose surcharges and weight limits on ships traversing the key global trade route, according to the Panama Canal Authority.

Ships move through the Panama Canal through a lock system, which uses water from several freshwater reservoirs to float the massive cargo vessels overland.

But Panama is currently gripped by drought, and water levels at least one of those reservoirs - Gatun Lake - are dropping.

Lake levels are forecasted to hit historic lows in July, prompting authorities to implement water saving measures as well imposing strict draft restrictions, which is the distance between the waterline and the lowest point of the hull, in the last few months.

The lake's dwindling water also supplies the nearby region, including Panama City.

"The climatic emergency decreed by the Panamanian National Government reinforces what the Panama Canal has been stating regarding the reality of a shortage of fresh water," the statement read.

Much of Central America, including Panama, has been in significant drought in recent months. But the start of El Niño "could worsen" conditions, the Panama Canal authority also warned.