Oil tanker attack could affect the price of oil as security costs mount

In something that sounded straight out of the movies, the world learned Monday about the hijacking of the MV Sirius Star over the weekend. The oil-rich supertanker was attacked and hijacked by Somali pirates in deep water in a brazen move that left even Navy Adm. Michael G. Mullen, chairman of the U.S. Joint Chiefs of Staff, "stunned."

In addition to carrying about $100 million in cargo, the supertanker has a crew of 25 different nationals. It was seized on Saturday, far to the south of the NATO patrolled zone, about 450 nautical miles southeast of Mombasa, Kenya, according to the U.S. Navy. The pirates took the ship to a Somali port known as a hub of pirate activity. The difference between this attack and other recent ones is that usually pirates attack within 200 miles of shore and go after much smaller vessels.

This is a cause of alarm since, as Navy commanders put it, it "represents a fundamental change in pirates' ability to hijack bigger vessels farther out at sea." It gets even scarier. If pirates have managed to attack this supertanker, there's no reason to believe they couldn't hijack LNG tankers. Liquefied natural gas is highly volatile and if a tanker explodes, it would equal fifty Hiroshimas. If an LNG tanker was hijacked, it could end up at the hands of terrorist.