Nov 18 2008
Pirates on the High Seas – Hijacking Oil Tankers
There are certain things in the world that you believe are the stuff of myths and legends. I assumed that the pirates of old were history and those who survived and those who wanted to justify a bigger navy perhaps embellished their exploits. Then I saw this story:
In a dramatic and unprecedented display of prowess, suspected Somalian pirates operating far out in open waters have seized an oil tanker as long as an aircraft carrier, the U.S. military said Monday.
The Sirius Star, flying the Liberian flag, was hijacked and its multinational crew of 25 were kidnapped by pirates off the coast of East Africa on Saturday more than 450 nautical miles from the port of Mombasa, Kenya.
The ship appeared headed toward Somalia, the East African country from where many of the region’s pirates set out on raids, according to the U.S. 5th Fleet.
The pirates made no immediate demands, said U.S. Navy Lt. Nathan Christensen. “It’s the largest ship we’ve seen attacked,” Christensen said from the fleet’s base in Manama, Bahrain.
Pirates!?!? Hijacking oil tankers? Those things are huge. How could something like that happen?
The burgeoning piracy crisis has flourished in lawless Somalia where almost two decades without a central government has left a country wracked by conflict, chaos and poverty.
“It was attacked more than 450 nautical offshore of Mombasa. This means that the pirates are now operating in an area of over 1.1 million square miles. This is a measure of the determination of the pirates and … a measure of how lucrative piracy could become,” Campbell said.
The pirates are holding the ship and crew and company officials are waiting for ransom demands. Just when we thought it was safe to go to the gas pump, now we get oil piracy. What did this act do to the markets in our fragile economy?
Oil futures spiked Monday morning just as news broke that Somali pirates had nabbed a Saudi Aramco-owned super tanker named Sirius Star off the coast of Kenya. The huge ship can carry up to 2 million barrels of oil.
Just before 9 a.m., oil futures stood at $56 a barrel. By 10 a.m., they rose $3 to nearly $59. But the price effect — if there was one — was short-lived. By noon, oil prices were back to their now-familiar downward slide and were trading in negative territory.
If my math is correct (2 million barrels at $59 per barrel), the ship’s cargo alone is worth $118 million. No wonder piracy is making a comeback. I’m glad to hear this act did not have a large impact on oil prices, but we still have a crew and ship in hostile hands. Hopefully, the crew will be released unharmed.
November 18th, 2008 at 9:36 am
I believe that the new tale of “A hijacked supertanker carrying up to $100 million worth of crude oil” is foolishness. How is it possible that knowing the incidents of piracy attack around the Gulf of Aden that a supertanker carrying US $100,000,000 worth of crude oil will not be escorted by a responsible Navy force? That is like carrying 100 million dollars on transparent plastic bags around a very bad known neighborhood and then saying: “the money got stolen, but we are ok”. Thank goodness that none of the crew members got hurt in order to make the story more real. If this is true then say the whole story.