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Felicity Bradstock

Felicity Bradstock

Felicity Bradstock is a freelance writer specialising in Energy and Finance. She has a Master’s in International Development from the University of Birmingham, UK.

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Despite High Prices, Oil Piracy Is In Decline

  • While oil pirates garner plenty of media attention with their attacks on oil tankers and platforms, oil piracy itself has been on the decline in recent years.
  • It seems piracy these days is more frequent between nations, with Greek forces confiscating Iranian oil before Iran’s Revolutionary Guards seized two Greek-flagged oil tankers.
  • While Mexico still suffers from relatively frequent oil piracy, Nigeria has reported a significant decline in attacks on its oil infrastructure and tankers.

Oil piracy is as old as the industry itself, with criminals unable to resist the profits associated with black gold. Today, while the problem still persists in several parts of the world, effective monitoring and security systems have massively reduced the threat posed by oil pirates. In 2021, global piracy hit its lowest level since 1994. In fact, the most high-profile oil piracy accusation of recent times was of a very different nature from the usual oil pirate reports. Greece accused Iran of piracy after Tehran's Revolutionary Guards seized two Greek-flagged oil tankers in Gulf waters. Greece’s foreign ministry stated: “These actions are tantamount to acts of piracy.” One of the tankers was sailing in international waters at the time of its seizure. 

This is not your typical form of piracy, but Greek authorities believe Iran’s actions equated to it. The move was apparently in retaliation for the seizure of an Iranian tanker by Greek forces for the U.S. to confiscate the crude on board. This month, the Greek Supreme Court upheld a ruling in favor of Iran for the confiscation of the oil shipment in April, which was transferred to a U.S. ship in an ‘act of piracy’. 

This action comes at a time when Iran is facing increasing scrutiny from the West for boosting its oil production for export despite ongoing U.S. sanctions on Iranian oil. Iran has been rapidly fostering relationships with trade partners around the world to increase its oil exports as governments are growing increasingly worried about their energy security in the face of rising prices and global shortages. 

More recently, Iran prevented a more traditional pirate attack, stopping the attempted oil theft in the Gulf of Aden. Five pirate ships tried to overrun two oil tankers, which Iranian authorities were escorting, but Navy commandos intercepted them. The Gulf of Aden has previously gained the reputation of “pirate alley” for the prevalence of Somali pirates in the zone. Typically, ships of all kinds take additional security measures when sailing through the waters to prevent attacks. 

Meanwhile, in Mexico, ten pirates in military clothing attacked a state-owned oil platform in Campeche in June. The criminal group took six workers hostage for over three hours, requiring them to help transport stolen goods to another boat. The attack was the second within a month at the Ku-Maloob-Zaap oilfield. The pirates typically steal thousands of dollars of equipment from ships when they successfully overrun operations.  Related: Repsol’s Earnings Jump Fourfold Amid Soaring Oil And Gas Prices

Within the past year, 11 pirate heists were recorded in the region, on platforms and boats, with stolen goods equating to over a million dollars. There has been an increase in piracy in Mexico in recent years, with global risk consultant firm S-RM suggesting “Ongoing insecurity in Mexico has likely further contributed to a permissive offshore security environment, which has grown increasingly more dangerous despite government efforts.” Although the Mexican government has put additional monitoring and security systems in place in the oil-producing states of Tabasco and Campeche, it has not been enough to deter pirates from attacking the regions. Ships sailing in Mexican waters have, therefore, had to increase onboard security measures to respond in the event of an attack. 

On the other side of the world, in Nigeria, this month the government reported a decrease in piracy attacks over the last half a year. Nigeria is well known for its pirate activities, with the shipping industry long calling on the government to implement security measures to curb attacks in the region. And finally, the state has some good news, with the International Maritime Bureau (IMB) announcing that Nigeria recorded the fewest numbers of armed robberies in its waters and pirate attacks against its ships globally in the first half of the year. 

In the first half of 2018, 31 cases of piracy were reported in Nigerian waters, compared to none so far this year, out of 58 incidents globally. Although 12 attacks did take place in the Gulf of Guinea outside of Nigerian waters. Munro Anderson, director at Dryad Global, a UK-based shipping consultancy, previously stated that “pirates are able to operate with utter impunity.” Nigeria has been repeatedly blamed for failing to control the territories beyond its urban areas and oil facilities, putting ship operators at greater risk of attack. 

However, it seems that Nigeria is improving in its response to piracy. The Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Bashir Jamoh, confirmed that Nigeria is dedicated to sustaining the momentum of the recent success in curbing attacks. The achievement is thought to be the result of cooperation between national and regional players to improve security. 

While reports of oil piracy around the world are becoming less frequent, it is undoubtedly still a threat that companies and governments must remain vigilant about. 

By Felicity Bradstock for Oilprice.com

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