At 12.30 hours on 13 May 1943 the unescorted and unarmed Gulfpenn (Master Arthur S. Hodges) was steaming five miles ahead of the Gulfprince, when the other tanker was attacked by U-507 (Schacht). The Gulfpenn immediately left the scene on full speed and later steered zigzagging course in irregular patterns at 12.5 knots.

At 21.38 hours on the same day, U-506 fired one torpedo, which struck the Gulfpenn aft in the engine room on the starboard side, killing all men on watch below and immediately stopping the engines. 26 men from the eight officers and 30 crew men abandoned ship in two lifeboats. One crewman later died of wounds. One officer and 11 crewmen died in the explosion or went down with the tanker, two of these died trying to retrieve personal papers.
The ship made a half-circle and then plunged stern first within five minutes about 30 miles off the entrance to the Mississippi River. Three hours later, the survivors were picked up by the Hondurian steam merchant Telde, which had been directed to them by a US Coast Guard aircraft and taken to Pilottown, Louisiana and thence to New Orleans.