Terrorist attacks threaten the security of nations and create an atmosphere of uncertainty. These threats impact stocks and commodities markets around the world and make investment decisions very difficult, even for the experts.
So what can average investors do? First, they should ask themselves what the likelihood is of a major terrorist attack. Then, they should determine whether their portfolios are hedged sufficiently with oil-related investments that would increase in value should a major terrorist attack disrupt oil production and distribution.
“One of the critical issues we face with oil security is its transportation,” said Roger L. Cory, president of Mammoth Resource Partners Inc., a Kentucky-based oil and gas exploration company. “Our oil transport system is a worldwide network. It’s practically impossible to secure it all and one soft target for terrorists can create significant disruptions.”
Mammoth Resource Partners released a lengthy report detailing the vulnerability of this industry to terrorism. The report warns that the “oil transportation system provides an endless array of possibilities for the terror...