Ahoy There! Prepare To Be Boarded! 21st Century Piracy Is on the Rise

The attacks have been taking place in the high seas off the eastern coast of Africa, some 450-plus nautical miles off the coast of Somalia. While the old Barbary pirates may have seemed to have disrupted shipping lanes in their day, and also wreaked human and economic damage, the current state of shipping off the Horn of Africa is getting out of hand quickly.

With the recent attack on a Maersk Lines U.S.-flagged vessel—the Alabama, with an American crew of 21—attention has turned again to the Somali-based pirates. Fortunately, the crew was able to keep the pirates from ever gaining control of the vessel. The Captain offered himself as hostage and spent five harrowing days in captivity before being rescued by the U.S. Navy. This was the first taking of a U.S. ship by pirates since 1804. This incident brought immediate global attention to this serious and deadly maritime problem. With the United States' involvement and attention finally focused, perhaps piracy will now face a more formidable deterrent than in the past.

Many ship owners and insurers simply pay a ransom. It is rumored that the takers of the huge oil tanker Sirius Star asked a ransom of over $30 million for the ship and its crew and cargo. It is now anchored off the Somali port of Haradheere, a favored pirate haven. At one time, there were at least a dozen other vessels also held there with crews totaling over 250 people, all awaiting ransom payment or other fates. On June 11, a Bermuda-flagged cargo ship was taken off the coast of Oman, the first such attack off the Straits of Hormuz at the mouth of the Persian Gulf.

What does this mean to oil and other cargo shipments destined for the United States? Since many shipping lines are opting to avoid the pirates' operating area, they are taking the longer trip south around the Cape of Good Hope, rather than through the Suez Canal. This longer voyage means more time at sea for goods destined for shop shelves, more fuel used by the ships to take the longer route, a larger carbon footprint from the ship's diesel "bunker fuel" usage, and higher inventory carrying costs to either the seller or buyer of the cargo. It has been estimated that the trip around the Cape can add up to seven days and 40% to the costs of the voyage to eastern U.S. ports. The Suez Canal is also suffering a loss in revenues every time a ship chooses the Cape route. In the case of oil, this simply adds another variable to the already-volatile oil-pricing formula.

Insurance premiums are also increasing, which unnerves the shipping industry and adds costs to the transit price for a lengthening journey from origin to market. One London-based firm that specializes in risk insurance premiums for the Gulf area recently noted that insurance costs have increased from $500 per voyage last year to over $20,000 per voyage this year.

Japanese shipping concerns recently stated they would incur more than $100 million in added costs to have their vessels change routes to avoid the Somali pirates. The Japanese Ship Owners' Association estimates it would cost an additional 40-million yen for one ship to take the longer route around the cape of South Africa and avoid the Red Sea. Their estimate for such a route change is up to an additional 10-14 days on the water and 6,500 kilometers (or 4,030 miles) to the trip.

What is the solution? The threat of piracy is as large a threat as shipping has faced possibly since World War II. Any tanker sailing the Gulf and any freighter choosing to utilize the Suez Canal become targets for these pirates. As we were shown in the boarding of large ships like the Alabama, size does not always deter these rogues from their plunder.

Like most complex problems, there is not one single, easy solution. The pirates must be deprived of a friendly sanctuary that aids and abets their crimes. For that to happen in the long term, Somalia would have to be controlled by a legitimate government that has a monopoly on force, not by a fractious mix of warlords and other violent organizations.

In the short term, the taking of the vessels in the first place must be stopped. The U.S. Navy's heroic action freeing the Maersk Alabama captain was a brave show of force. However, U.S. Navy is spread thin and we need—as with so many other global conflicts—to elicit the aid of other nations that are being harmed by these thugs.

Generally, evasive action and speed have been sound deterrents. It is difficult to board a ship moving at a speed in excess of 18 knots. Slower ships can join a protected convoy, move at night, and keep a sound watch. Still, the key is to move at high speed and turn with slight course corrections to throw a large wake and create rough water that can disrupt the pirate's smaller boats that are attempting to come alongside and board. Arming the ship crews seems out of the question.

The Pirates now seem to be dramatically extending their area of operation to nearer the Persian Gulf area off the coast of Oman. It is here that oil shipments from the Persian Gulf pass in the large tankers that have been prey to the pirates. Since the fleet of international naval patrol vessels began concentrating on combating pirate attacks around the Horn of Africa, the pirate gangs appear to be moving northward. An immediate solution may be an "international vessel force" under a central command to better patrol a wider area. With the pirates now targeting the important Strait of Hormuz opening to the Persian Gulf's rich oil fields, the importance of oil and petrochemical flows to the world's economy will dictate quick and decisive action.