Saturday, 13 December 2008

Industry shocked by ‘Sirius Star’ hijack

Location and brazen seizure of loaded VLCC rings alarm bells.

[Mumbai 18 November] The hijacking of the VLCC Sirius Star on Saturday, November 15, has sent shock waves through the maritime and oil industries. Described as “ an unprecedented attack” by the US Navy, the seizure of the 2008 built VLCC carrying more than a hundred million dollars worth of oil and 25 crew has resulted in widespread international newspaper and television coverage; many speak of the hijacked ship carrying ‘almost a third of Saudi Arabia’s daily oil production’. What is alarming is not only the fact that a VLCC was successfully hijacked for the first time ever, but also the location of the hijack: over 450 miles South East of Mombasa and what would have been hitherto regarded as almost the middle of the Indian Ocean and safe from pirate attacks.

The Liberian flagged, 330m long Sirius Star, owned by Saudi oil giant Aramco, can carry about 2 million barrels of oil and has a deadweight of 318000 tonnes. It was fully loaded and heading to the United States when it was attacked. The crew includes Britons, Croatians, Poles, Filipinos, and Saudi Arabians. Vela, the Saudi operators of the Star, say that "all 25 crew on board are reported to be safe. Vela response teams have been established and are working to ensure the safe release of the crew and the vessel". Reports suggest that Vela is in contact with the hijackers of the VLCC.

By far the largest ship to be hijacked, the Star has been forced near the Somali coast and is reported to have reached the pirate stronghold of Eyl. Local Somali fishermen and reports from the US Navy seem to confirm this. The US Navy, which earlier reported the hijacking, said it had no information that the vessel had been released; this, after confusion over a Gulf based TV news channel’s report on Tuesday that the giant ship had been freed.
Saturday's attack comes after a flurry of recent hijackings and attacks that have raised threat perception levels across the Gulf of Aden. A chemical tanker owned by Japan was also seized on Saturday, and up to two dozen ships are presently captive while ransoms are being negotiated.

However, the Sirius Star’s hijacking, far to the South of the coalition navy’s so called safe zone in the Gulf of Aden, was described by one analyst as ”the pirates showing two fingers to the navies of the world”. Maritime security experts say that the widening of the kill zone involves an area which will be extremely difficult to patrol, as it covers thousands of square miles. They also link the spread in piracy incidents to recent developments within Somalia as Islamist groups capture new territory and threaten the transitional government there.

The incident also raises serious doubts about the ability of international efforts to patrol the Somali coast. Saturday's hijacking rings warning bells in that the pirates are capable of expanding operations far beyond the Somali shores, using mother ships, advanced satellite communication and logistical acumen. Maritime experts worry about the potential ecological catastrophe should there be any attempts to retake the tanker.

Meanwhile, The Times of London reported that the hijacking has had a ripple effect on the price of crude in international markets. At the time of writing this report, crude oil was about $58 a barrel, making the cargo on board the Sirius Star worth almost $120 million. A new VLCC costs more than that to build. No doubt insurance premia, too, would be set to go even higher.

At the Pentagon in Washington, the Chairman of the U.S. Joint Chiefs of Staff, Admiral Michael Mullen, said that he is "stunned" at how far the pirates are able to reach.


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