Pirates Aren't Stealing Oil Anymore Because It's So Cheap

| by Diana Kruzman
An oil tanker An oil tanker

A regional executive suggested that the falling cost of oil may be what's causing a decline in piracy in West Africa: With oil prices so low, hijacking oil tankers is no longer worth the risk.

Florentina Adenike Ukonga, the executive secretary of the Gulf of Guinea Commission, said in an interview with Bloomberg that the drop in the number of pirate attacks on oil tankers heading out of West Africa is partially due to the high-risk, low-reward nature of the venture, Quartz reports

“With oil at a low bottom price of below $30 per barrel, piracy is no longer such a profitable business as it was when prices hit $106 a barrel a few years ago,” Ukonga said, according to Quartz.

The Gulf of Guinea Commission is a regional body dedicated to promoting cooperation between West African States, many of which face the threat of piracy when exporting oil by sea. The Gulf of Guinea saw a surge in attacks as oil prices rose at the start of the decade; however, attacks by pirates have been declining since 2013, before the slump in oil prices began. According to Ukonga, the lack of economic motive to hijack oil tankers likely accelerated the process.

According to Oceans Beyond Piracy, a U.S.-based NGO that tracks maritime crime, the number of attacks on vessels in the Gulf of Guinea shrank from 100 in 2013 to 67 in 2014, and the number of successful attacks also dropped, from 56 to 26, Quartz notes. Since oil has traditionally been a valuable cargo, oil tankers were the main target for these attacks until the plunge in oil prices, which have fallen by $100 a barrel since July 2015, due to global oversupply.

OBP also noted that other measures, such as the increased presence of the Nigerian navy, has played a role in the decreasing number of attacks. In East Africa, particularly off the coast of Somalia, piracy fell after the oil industry began employing armed guards and international warships began patrolling the area, following a peak in attacks from 2011 to 2012.

Not surprisingly, the drop in oil prices has also led to a decline in gas prices in the U.S. The oil industry is in its biggest downturn since the 1990s, the New York Times reports. While this is a big problem for oil companies, with many going bankrupt and roughly 250,000 oil workers losing their jobs, it is good news for motorists. The average cost of gasoline in the U.S. is down to just $1.76 a gallon, which is a roughly 43-cent decrease since February 2015.

Sources: Quartz via Yahoo News, New York Times / Photo Credit: Thangaraj Kumaravel/Flickr, Frans Berkelaar/Flickr

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