Globalization Archives
Pirates and Oil
By Charlie
What a strange world we live in now. In the old days, piracy in the Mediterranean drove up the price of goods due to the increased costs of bribes to the local costal kings in the Magreb. Merchant vessels that flew under flags that paid the bribes received a free pass, while others that did not were subject to attack:
American ships sailing in the Mediterranean chose to travel close to larger convoys of other European powers who had bribed the pirates. Payments in ransom and tribute to the Barbary states amounted to 20% of United States government annual revenues in 1800… After some serious debate, the United States Navy was born in March 1794. Six frigates were authorized, and so began the construction of the United States, the Constellation, the Constitution and three other frigates.
Now, another coastline wracked with anarchy has given birth to piracy, which seems to equally affect global trade. Pirates shot a rocket at a Japanese oil tanker off the coast of Yemen, which promptly shook global oil prices:
Oil reached a record $117.40 a barrel at one stage yesterday, dragging up the price of gas to a new peak, amid concerns about crude supplies after a Japanese tanker was attacked in the Middle East and militants blew up a Royal Dutch Shell pipeline in Nigeria.
The civilized world seems to have reacted to this:
UNITED NATIONS - The United States and France are drafting a U.N. resolution that would allow countries to chase and arrest pirates off Somalia's coast, responding to a spate of attacks including this week's hijacking of a Spanish tuna boat, U.N. diplomats said Monday.France's U.N. Ambassador Jean-Maurice Ripert said the resolution would authorize foreign governments pursue pirate vessels into territorial waters, make arrests, and prosecute suspects.
"We want to do it fast, but it could take one or two weeks because it has to be by consensus — it's not confrontational," he told the Associated Press.
Consensus used to be that pirates were hanged. I see no reason for that to change because of the number of years between today and 1778.
