Piracy off the coast of Nigeria is estimated to cost over $7bn annually, with the bulk of costs affecting the oil industry. And over in Singapore, pirate groups can earn up to $1m for a successful tanker hijack.
But the data suggests that plummeting oil prices are driving a tactical shift by pirates, replacing oil theft with kidnap for ransom in Nigeria, and exposing anchored tankers in Singapore to greater hijack risks.
Piracy thrives in the Gulf of Guinea due to a lack of robust law enforcement, access to illegal markets and a target rich environment.
Between Jan 2012 and Feb 2016, Verisk Maplecroft recorded 62 separate piracy attacks relating to oil and gas platforms off the Nigerian coast, nearly half the country’s total number of incidents. This number has been falling though, from 22 in 2014, to 13 in 2015, to only two in 2016 so far.
Concurrently, the number of hostage taking events in Nigerian waters has risen from 4 in 2014, to 13 in 2015 and 4 already in 2016. While it's too early to say if this is a direct result of falling oil prices, there is a strong correlation.
A less considered impact from the falling oil price is the surge in tankers anchoring for long periods in pirate hotspots, as they act as temporary storage facilities until oil prices stabilise.
Singapore is particularly at risk, with recent suggestions that a major commodities firm has anchored four tankers there for storage purposes.
Singaporean waters are already at high risk of pirate attacks, with 66 successful boardings recorded by Verisk Maplecroft between 2012-2016.
While the bulk of these attacks were ‘snatch and grab’ incidents, static tankers are a tempting hijack target as they allow pirate groups the time to monitor security routines, select suitable boarding points and organise complex operations.