Trouble In The Suez! Oil Tankers Surge On Egyptian Violence

Agustino Fontevecchia|Forbes

Vital Waterway: While the unrest in Egypt continues to be only a political element at the moment, if the country were to fall into the hands of a religious faction, namely the Muslim Brotherhood,US imports of oil could be seriously threatened.

While all three major U.S. indices took big hits, with the Dow leading the way down losing 2.5% to 11,824 points, a few stocks were spiraling upward on the news that chaos was engulfing the Northern African nation of Egypt. Oil tankers such as Overseas Shipholding Group (NYSE:OSG) gained handsomely on the possibility that the Suez Canal could be forced to shut down. The NASDAQ had fallen 2.5% to 2,687 while the S&P 500 shed 1.8% to 1,276.

Civil unrest in Egypt had already sent a shock wave through different markets. Apart from rocking US indices, Egyptian violence sparked a jump in oil prices during Friday January 28’s trading session (Read Egyptian Civil Strife Sends Oil Close To $100 On Suez Canal Fears).

While most equity-related assets got battered, a select group of stocks, oil shippers, were corking champagne bottles. Apart from Overseas Shipholding, Frontline Ltd. (NYSE:FRO) had a killer day, gaining 7.8% or $1.96 to $27.10.

Read More Here