The market liked the idea that Top Tankers (NASDAQ:TOPT) was selling off its fleet of ships and then immediately leasing them back, but it's still a somewhat strange move, considering that the company had only bought most of its ships fewer than two years ago.

Top Tankers carries oil for major petroleum companies such as Shell (NYSE:RDSa), Chevron (NYSE:CVX), and ExxonMobil (NYSE:XOM), and it's a big business: Tankers are the only way besides pipelines to transport large quantities of oil around the world. But even with the price of oil remaining high, the industry is also volatile. Some say it has already peaked, perhaps as many as two years ago.

When Top Tankers went public in 2004, it used the proceeds from its IPO to finance the purchase of 10 ships, and then it bought five more after a follow-on offering later that same year. The company now says there is high demand -- and, thus, high prices -- for secondhand tankers, and it wants to capitalize on that demand while still maintaining control of the vessels, a process it began last year. It was selling off 13 ships for $550 million but immediately leasing them back for five to seven years. The proceeds will be used to pay shareholders a special dividend of $5 a share, with a second special dividend of $2.50 a share to come later in the month. After the sale, Top Tankers will run 27 ships, nine of which are owned and 18 of which will be leased. The market approved of the move -- the stock climbed 20% on the day.

Still, Top Tankers is still a tiny company in a sea of much larger competitors. Teekay Shipping (NYSE:TK), for example, with the largest fleet, operates 138 ships, while No. 2 tanker company Overseas Shipholding (NYSE:OSG) has 107 vessels.

Despite the strong quarterly report last month, Top Tankers' average daily revenue performance numbers -- called TCE, or time charter equivalent, an industry performance standard -- were off 18% in its Suezmax class of vessels while up only 3% on its Handymax class. The company says it had the highest Suezmax class TCE of $61,447 among its peers, but that's a long way off the $74,838 earned last year.

Demand for oil in China continues to be a significant impetus to the industry, driving up demand and prices. It also fuels the need for more tanker capacity at the same time international maritime regulations call for phasing out single-hull tankers for safer double hulls by 2010. Nearly a third of the world's tanker fleet consists of single-hull tankers. That's not a concern for Top Tankers, though, since almost all of its ships are double hulls, but should demand for oil in China fall off, investors could get a sinking feeling, special dividends or not.

Fool contributor Rich Duprey does not own any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.