Good Company

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Thursday, January 10, 2008

Nigeria: Pirates keeping the price of oil high?

Gunfire, injuries but no seizures, as set out here:
Unknown gunmen attacked six oil industry ships on the channel leading to Nigeria's largest oil and gas export complex on Bonny Island on Wednesday, oil company security sources said.

Two people were injured, one of them seriously, but none of the vessels was boarded, the sources said. Bonny Island is the export point for about 400,000 barrels per day of crude oil and 18 million tonnes per year of liquefied natural gas.

"Six vessels were attacked within the space of about 20 minutes," one of the sources said, asking not to be named.

The ships involved were all used to service oil platforms, production vessels and rigs offshore. They normally work under contract to major oil companies and are manned by a combination of foreigners and Nigerians.

"It sounds like sea pirates because there were no hostages taken," a second source said.
I mean, why else would Reuters pit the article on the "investing" page?

Steve Schippert has suggested that the recent Iranian small boat adventure (and here, here) was perhaps an effort to keep oil prices up:
But from there, most public reactions have failed to identify proper context for the Iranian actions this weekend.

First, in a quote attributed to an unnamed official in the latest New York Times article on the incident, is the possibility of an Iranian probe, testing reactions and observable procedures for future reference. “Whether they’re just testing us to learn about our procedures, or actually trying to initiate an incident, we don’t know,” the Times quoted him as saying.

Second, and more importantly from a strategic view rather than tactical, is the Iranian leveraging of crisis and instability in the manipulation of sky-high crude oil prices, the only boost that exists in the Iranian economy.

Oil is flirting with $100 per barrel. Its average price in December dropped to just over $88 per barrel from over $92 average for the month of November. Incidents like this weekend's serve to remind the global oil market of how fragile the supply route is, thus maintaining premium price for Iran's only significant export and only significant source of revenue.

There almost certainly was never any true suicide ramming threat on the open Strait. But perceptions can be quite profitable.
You know, in case there was like a conspiracy or something between the Nigerian pirates and the Iranians...

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