At 10.55 hours on 11 June 1942 the unescorted Sheherazade (Master Trygve O.B. Wold) was hit on the starboard side amidships and in the bunker tank by two torpedoes from U-158 about 20 miles west of Ship Shoal Buoy. The explosions destroyed all power facilities, stopped the engines and caused a starboard list of 45°. The tanker capsized after being hit by a coup de grâce on the starboard side in the engine room at 11.05 hours. The U-boat then surfaced and fired eight rounds from the deck gun into the bottom of the tanker to sink her.

The 44 crew members and 15 armed guards abandoned ship eight minutes after the hit in a lifeboat, a motor boat and by jumping overboard. One crew member was lost. The shrimp boat Midshipman rescued 26 survivors from the motor boat and nine who had jumped overboard and landed them at Morgan City, Louisiana the next day. The 23 survivors in the lifeboat were picked up by the fishing vessel 40 Fathoms at 14.30 hours on the same day and landed at Morgan City.