If I recall correctly, the laws regarding blockade, search and seizure in force at the start of World War I were written at the start of the nineteenth century, before the steamship and submarine were invented. The Germans could claim to have given warning of attacks on merchant ships by posting advertisements in the American press. To an extent, many of the losses were the responsibility of the British Admiralty, who failed to institute properly escorted convoys, preferring instead to send cruisers rushing around large areas of ocean where the submarines weren't. For a submarine to sink a merchant ship belonging to an enemy or in a war zone where it has no right to be, without warning (except a clearly marked hospital ship) is generally no longer regarded as a war crime. To machine-gun survivors in the water (as was alleged against German and American submariners) definitely is.
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