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Threats to Western Oil: 2 Tankers Hijacked in 2 Days

Supertanker Irene SL pirated in Arabian Sea, carrying 2 million barrels of crude, one day after another tanker was seized.
By Gil Ronen
First Publish: 2/10/2011, 4:23 PM / Last Update: 2/10/2011, 4:37 PM

Major oil lines to the West are under severe threat after a second supertanker was hijacked in as many days in the Arabian Sea. Shipping officials said the Irene SL was pirated Wednesday morning about 350 nautical miles south-east of Muscat in the North Arabian Sea. It was carrying about two million barrels of crude oil, worth about $200 million.

With a dead weight of 319,247 tons, the Greek ship is in the supertanker category. The vessel was on its way to Suez from Fujairah when it was attacked, according to the European Union Naval Force (EUNAVFOR), which protects vessels from piracy. The ship has a crew of 25: seven Greeks, one Georgian and 17 Filipinos. 
 
EUNAVFOR said, "There is presently no communication with the vessel and no information regarding the condition of the crew." 
 
One shipping official called the hijacking a "significant shift in the impact of the piracy crisis" that has placed major oil lines to the West "under severe threat."
 
Joe Angelo, managing director of the trade association INTERTANKO, told CNN the ship was ultimately headed for the U.S. coast on the Gulf of Mexico. "Two million barrels of Kuwaiti crude oil destined for the U.S. in a large Greek tanker in the middle of the main sea lanes coming from the Middle East Gulf marks a significant shift in the impact of the piracy crisis in the Indian Ocean," Angelo told CNN.
 
"If piracy in the Indian Ocean is left unabated, it will strangle these crucial shipping lanes with the potential to severely disrupt oil flows to the U.S. and to the rest of the world," he warned.
 
On Tuesday, pirates attacked the MV Savina Caylyn, an Italian-flagged oil tanker, which was headed from Sudan to Malaysia. A reported five pirates fired small arms and rocket propelled grenades before boarding the ship.
 
A third ship, the Golden Wave, a South Korean fishing vessel seized in October off the Kenyan coast, has reportedly been released by pirates who commandeered it in October. EUNAVFOR said that the 43 crew members are in need of food, water and medical aid.
 
According to cables published by Wikileaks, the U.S. is concerned that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices from escalating. The cables were sent from the U.S. embassy in Riyadh. According to the British Guardian, the cables "urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40 percent."
 
The revelation comes as the price of oil has soared to more than $100 a barrel because of global demand and tensions in the Middle East, the newspaper noted. "Many analysts expect that the Saudis and their OPEC cartel partners would pump more oil if rising prices threatened to choke off demand," the paper reported.