The parameters of the spill are in fact Tril angel to prent indepen to
great lengths to prevent independent monitoring of the oil flow. BP has two main reasons for doing this; first to get maximum benefit from spin by minimising the size of the spill, second to attempt to reduce the figures that will be used as one factor in deciding compensation claims and possible penalties in any
However, from what has been shown and from outside commentators' estimates, we can say that it is certainly one of the worst ecological catastrophes caused by oil spillage in history. Ot course it is also one of a long line of oil spill disasters such as the Exxon Valdez spill in Alaska, the recent large spill in China, and the ongoing damage to areas where oil is drilled for such as in the Niger Delta or the Amazon in Ecuador.' So far the known impacts are huge. Eleven workers were killed in the explosion itself. Large numbers of sea creatures have also been killed. BP and the US authorities have tried to play this down by excluding the public from areas where animal corpses are being processed.
Oil causes a lot of damage immediately, from toxicity, from overwhelming birds and animals, and by landing on beaches. It does though gradually degrade in seawater if the overall capacity of the sea to deal with it is not exceeded.2
In my view the attempt to keep oil off the shores should have relied mainly on physical barriers. Poison from the dispersants used may well be an even more dangerous problem for clean-up workers than the original oil. The long term effects on sea creatures in the Gulf are uncertain but probably very bad. Reports from Alaska say that many species have never recovered from the Exxon Valdez spill.
At the time of writing oil is still visible in the Gulf, and still landing on beaches and islands. The authorities though are slowing down the clean-up, claiming that most of the oil has gone now that the well is plugged. There are indications that after the latest tests on pressure around the seal the US authorities will oblige BP to proceed with drilling the relief well and inject more cement to
21 plug the well two miles below the surface of the sea, hopefully to permanently seal it. This shows in fact that they are still uncertain at the moment about what is going on in the borehole below the plug at the top, or in the sea bed around the
The treatment of the clean-up workers shows precisely the cruelty and brutality of those who run BP just as much as has the emerging catalogue of corner-cutting to save time and money which led to the blowout in the first place. Repeated reports have surfaced in the media of clean-up workers being banned from using safety equipment such as gloves and masks or being punished for asking
There will clearly be an ongoing toxic impact on the coastal population of Louisiana and further afield. Some reports have also pointed out that many in the area were traumatised only five years ago by Hurricane Katrina and the callous response of the authorities to that. Mental health problems, including stress and depression from the disaster, or the fear of or actual health problems caused by the spill are already rising. The
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Four months on from the explosion, what is there to say about the BP Deep Horizon disaster? 22
stress of losing businesses or employment, in a country with little welfare,
and the stress of litigation and making
compensation claims is already starting.
As for the well itself, much fear was
expressed (not by BP) before the capping
and plugging that the borehole and
perhaps the seabed had been damaged by
the explosion, resulting in leaks of oil
and methane of unknown volume from
the casing and the surrounding seabed
and that the blowout preventer used for
the 'test' capping was not nearly strong
enough to take the pressure expected. So
further risks were taken here - note the
dispute between BP and various US
authorities over how long the 'test' capping would be for; which seems to
have become permanent, under threat
that the oil would start to flow again if it
were removed! Furthermore, accurate information about the state of the borehole and the surrounding seabed is not publicly available. It remains to be seen how far the slick can go. There are predictions that it may hit most of the north-east US coast and even reach Europe before it degrades fully? It may also be some time before it is clear whether BP can survive as an independent entity. The fact that it was obliged to pass on its normal dividend was a big shock (moral and financial) to many British institutional investors. It was reported early on that BP profits normally provide a staggering proportion of the profits available to shareholders as reported on the London Stock Exchange. Many British pension funds own shares in BP and even a single passed dividend will increase the pressure on them, pressure that is already heavy since the anancial crash, two years ago. At the end of the day, less money will be available for pensioners.
BP's belated lobbying of the US authorities and the appointment of a new US chief executive may not be enough to save it from abrupt financial decline. Whether from legitimate fines, US scapegoating for the disaster (the US authorities had deliberately allowed very lax supervision of deepsea rigs, in order to give the 'free market' a free run) or loss of confidence in the company by the financial community. In this event the knock-on effect on world financial markets (more than on oil markets) and the British government will be substanFor some time articles have been appearing in the financial press suggesting plausibly that BP has been engaging in huge volumes of derivatives trading and financing of a similar type to what brought down Enron and then Lehmann Brothers and Bear Stearns. It has been pointed out that until the Deep Horizon disaster, BP was viewed as stronger than a bank because it had a vast array of physical assets, a cash mountain, and steady cash income. So it was able to engage in derivatives operations both to hedge its own trading positions and to make profits by lending to less creditworthy companies and hedging on the loans.
The market in BP bonds has been under a lot of pressure in recent months, though it seems to be easing off now that the well is plugged. But the company may come under severe financial strain to find the money for fines and compensation. It may also find it hard to get new licences in the US where it accounts for 97% of oil company legal violations. These factors may well lead to BP's loan repayment schedule and derivatives operations coming unstuck." This side of the story shows how vulnerable the global financial system, as well as the environment, is to large and unaccountable companies.
In mid-August, the financial press is reporting that Kuwait and Abu Dhabi, small but rich Middle Eastern oil-well states trusted by the US and Britain, are taking or looking at upping stakes in
No doubt a safety measure (both for BP and the British government) while the company also reduces its new investment and sells off assets to raise cash. But if the company were to be broken up, presumably nobody would be likely to buy it without the sort of open-ended government guarantees on clean-up costs and other liabilities that are usual when nuclear power companies are privatised.
Who would have to pay for the guarantees? Working people and taxpayers in brıtaın, obviously. And this at a time when there is a big question mark over Britain's solvency in any case. On the Gulf coast, there is evidently a lot of community solidarity, and environmentalists and lawyers such as Robert Kennedy Jur are already doing their best to help people fight for their rights and
curb the power of the oil companies. But
some of the destruction is permanent,
and community solidarity will not be
enough on its own to gain even passable
compensation for the losses suffered by
the humans alone; this is the lesson of
past such disasters. Still, probably a lot
of people across the world will have seen
the pictures of destruction and misery, including those of the Chinese fishermen and other workers forced to move oil
with their bare hands, and will be radicalised by what they have seen. The very scale of these disasters, and what they expose about the authorities' attitudes, also show that capitalism (whether of the US or Chinese variety) generates these and other disasters ceaselessly, but cannot repair them. Alternatives Mobilisation by the authorities in one country or another in the face of floods or chemical contamination may be more or less good on any given occasion - but the conclusion to draw is that the present system cannot in general deal effectively with the disasters it generates. The pathetic results of the last Copenhagen summit show this; and that at root this failure is based on a lack of political will, as well as on the insane drive for profit.
Ecosocialist organisations on a world-wide basis are needed, that can support and link all the struggles for social, economic and ecological justice, and to strengthen the fight tor the survival of the planet and to replace the current highly irrational system before it Notes 1 http://www.amazonwatch.org/amazon/EC/ 2 http://www.offshore-environment.com/oil.html 3 http://healthygulf.org/ 4 http://bit.ly/dvUqaX 5 http://bit.ly/9CuKTi 6 http://www.thiscantbehappening.net/node/148 7 http://bit./y/9U7iTU 8 http:// bit.ly/bvS4wV 9 http://bit.ly/ceQDVv and http://bit.ly/dtWNIr 10 http://bit.ly/bab80n and http://bit./y/bar6qm