Pirates have been operating off the coast of Somalia for some time.
The other day pirates seized a ship, not near the east coast of Africa, but way out to sea. And it wasn't a jillionaire's yacht. It was an oil tanker. And not just a regular oil tanker. It was an oil tanker, the Sirius Star, carrying two million barrels of Saudi Arabian oil worth well over $100 million.
Apparently the futures markets are not terribly concerned about the odd supertanker being hijacked by Somali pirates. Oil closed yesterday about even from the day before at $54.52 a barrel.
Then yesterday, other pirates seized a Chinese-flagged ship carrying 36,000 metric tons of wheat. If my math is correct (which is almost never is) that is about $8 million worth of Chinese wheat.
That's the bad news. The good news is, that wheat was bound for Iran.
Let's go back to the oil tanker. This isn't like hoodlums in the Bronx hijacking a truckload of cigarettes on the New Jersey Turnpike coming up from North Carolina. A pack of cigs is easily sold on the black, grey, or any other market.
According to Forbes Magazine the average price of a package of cigarettes in New York City is now $9.72. If that is true than selling cigarettes offa the back of a truck which doesn't include no city or state or federal taxes is going to be a hot business.
But, the average Somali pirate can't sail a 1,080 foot tanker into Galveston Bay, anchor, climb into small boats, land, and sidle up to some guy in a bar saying, "Pssst! Hey, buddy. Wanna buy a couple of million of barrels of oil?"
So, how do pirates take over a gigantic ship like the Sirius Star? Why can't the crew fight off the invaders like they used to do in an Errol Flynn movie?
In the good old days of sailing - say 1799 - there might have been nearly 400 crewmembers aboard. A dozen, or so pirates zipping up alongside and attempting to take over a British Man o' War would have been … unsuccessful.
Because of modern technology, modern supertankers are sailed by a couple of dozen crew members. In fact, according to UPI.com the Saudi ship was sailed by a crew "composed of two British, two Polish, one Croatian, one Saudi and 19 Philippines nationals."
According to the BBC "Most vessels captured in the busy shipping lanes of the Gulf of Aden fetch on average a ransom of $2 million."
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