Tankers and Tycoons | 60 Minutes Archive
In a Nutshell
Post-Six-Day War Suez closure in 1971 forced oil tankers to take longer routes around the Cape of Good Hope, skyrocketing freight rates (e.g., Worldscale 200 for a 250,000-tonner yielding $4 million profit per two-month voyage) and enriching tycoons like Daniel Ludwig, Aristotle Onassis, Stavros Niarchos, and Norwegian Rexton, who turned calculated risks on spot charters into fortunes of hundreds of millions. A $36 million Rotterdam-built tanker could recoup costs in under two years, carry New York state's daily oil needs, and earn 3-10 times its price over a decade, fueling a secretive London-centered industry of high-stakes gambling on oil demand. Amid booming Oman oil ops and grueling crew life aboard automated "supertankers," these massive vessels—prone to collisions, explosions, and pollution—maximized tycoon profits at escalating risks.
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The oil tanker is the single most remarkable money-making instrument in the world. Since the Six-Day War four years ago, tanker profits have skyrocketed. Tanker tycoons, a small secretive band of high-stakes gamblers, contemplate a golden future of more oil, more tankers, more money. The world's appetite for oil shows no signs of slacking off, and the only way to get oil from foreign fields to consumers is by tanker.
Cold and rainy day before spring in Rotterdam. A big ungainly money-maker slides down the ways, carrying a quarter of a million tons of oil. Cost $36 million to build. If the market holds, owners can earn back $36 million in less than 2 years. Built with 300,000 tons of steel by 150 men over 8 months. May live 10-15 years, earning 3-4-5-10 times her cost. Half the size of half-million ton jumbo tankers building in Japan. Carries enough crude oil to power the entire state of New York for one full day.
This vessel flies the Liberia flag (Stars and Stripes) for tax convenience and avoidance. Tanker tycoons are greedy, of assorted nationalities. London is the true center of the tanker business, where money is managed, contracts negotiated, most ship owners have offices.
Tanker shipping has its own rules and mystique, depending on secrecy and trust. Owners and oil companies deal through a broker who takes a percentage from both sides.
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