With all the jitters in today's oil market (tremendous demand from China and India, tight supplies, little spare capacity), the last thing anyone wants is for pirates to start attacking oil tankers and create havoc and uncertainty in the marketplace.
Remember how that mortgage/credit crisis that broke a few weeks ago was turned into a Bear Stearns-destroying catastrophe because the deadly beast of uncertainty was let loose in the marketplace? Now imagine what would happen if ships carrying oil started getting attacked on a regular basis. Not hard to see what kind of devastating impact that would have on global oil markets.
As the villain in my book so aptly stated, while contemplating the very kind of attack that took place yesterday: "Today’s global oil market has very few reserves and little capacity to absorb supply disruptions. Even the threat of a shortage is enough to terrify the commodity traders. Panic buying will send the price of oil shooting through the roof and lay the groundwork for the economic devastation that will follow soon after.”
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