It has been a while since we haven’t read repeatedly of a harmful situation for the oil industry related to piracy, and specifically the ones heavily concentrated in the Gulf of Guinea, where until recently, news about ransom or kidnapping of a vessel in this region by the so called pirates of the seas were more than common.
But those were times of high oil prices right before the oil glut caused by OPEC and shale crushing prices. As a result of lower prices, it looked as though piracy was not as profitable. But the question remains if piracy will die out definitely due to low oil prices. Who has been benefiting and profiting from these types of activities? There has been tremendous impact on the global oil and shipping industries.
Based on the fact that the majority of these types of incidents and situations of piracy and kidnapping of oil tankers have been happening in the African and Asian continents since 2014, what lessons can we learn? Many of the world’s biggest chokepoints are located in Asia, like the Strait of Malacca or the Strait of Hormuz or the Gulf of Aden, and based on the continuing political and security instability, then we can expect these types of incidents to be happening especially with oil and gas vessels and tankers worth millions of dollars floating those waters.
So in times when we are seeing no considerable rise of oil prices after many efforts by OPEC and non OPEC, bringing them no higher than 60$ at least during the rest of the year, can we expect a rise of piracy incidents? In Asia and in Africa global powers are in moves to flex muscles against each other in order to keep their influence like the U.S, Russia, China, Iran or India? Maybe to justify some repositioning of their respective navys? How the war on piracy is a big business
Lets see what time tells us with regards to this critical issue related to energy security globally.(Source: OILPRO)