BP Oil Spill and Water Pollutions’ Impact on Commerce, Research Paper Example

Introduction

Environmental pollution issues are native and minor due to the Earth’s own ability to soak up and purify minor quantities of pollutants. The progression of society with the introduction of automobiles, and also the explosion of the population, are factors that are contributory toward the growing pollution drawback. Throughout the past hundred years, and because of new technologies, the globe has modified in some ways. Some changes have improved the standard of life and health for several people; however others have affected people’s health care adversely inflicting totally different varieties of pollution that have injured the environment. The economy and the environment work hand in hand, as when settlers first came they began to make money off of agriculture, shipping, and trading. Since that time society has advanced rapidly, however, the spoils of the earth still bear economic fruit. However, this is all being challenged.

With one of the oldest ways in which commerce is being made by ships, fish, and other economic factors that are dependent on the water, pollution from nature and man, have caused problems. When trying to identify the problems in the water and air, pollution is the contamination of the environment by semisynthetic materials or energy that has adversative effects on living or non-living matter. This contamination of water, air, and soil material inhibits with the health of individuals, and also the functioning of the scheme. However, the pollution that comes from larger companies that are usually looking to increase their profits, will disregard the safety of their workers, or take into consideration the environment that surrounds them. The purpose of this paper is to look at the waterborne commerce problems that stem from the pollution in the oceans. This has been enhanced by the oil spilling throughout history that has not only severely impacted the oceans and its’ ecosystem, but also the economy with higher gas prices, disruption in small business commerce, and other economic activities. The advances in technology have led to safer and more efficient ways to water oil drilling, but it is still in its infancy stage to evaluate if this will be a safer alternative to increase waterborne commerce activities.

Pollution is extremely harmful to the setting and to the ozonosphere. The contemporary setting is extremely necessary for this planet earth, and it must not be destroyed nor broken. Pollution effects are so severe and wide-ranging, that there’s little doubt that excessive levels of pollution are inflicting plenty of harm to both the healths of humans and animals, plants and trees,  as well as tropical rainforests, still because the surrounding environment. There, are many sorts of pollution like air, water and soil pollution. All of them have a sway on the living setting. The consequences in living organisms could vary from delicate discomfort to serious diseases like cancer to physical deformities. The specialists are additionally admit that the pollution effects are terribly often underestimated which additional analysis is required to know the connections between pollution and its effects on all life forms. The standard of our water can deteriorate, pollution is destroying the world. Water has six key pollutants. These pollutants are the following: waste material and alternative oxygen-demanding wastes, plant nutrients, exotic organic chemicals, petroleum, hot substances, and sediments. The main sources of pollution are classified as municipal, industrial, and agricultural. Water pollution is a very serious problem that greatly impacts several sectors of the business world.

Literature Review

For decades, the oil business has broadened the scope of however and wherever they will drill for oil. The drilling for oil has brought billions, by estimate even trillions to companies and oil tycoons, which have commissioned the government to drill in the oceans. Advances in technology have enabled the development of offshore drilling platforms acting at depths never before fanciful. Environmentalists have warned for years against offshore oil drilling platforms citing potential harm to ecology or perhaps worse, disaster. P1: Technology for oil drilling has evolved since the Exxon Valdez Oil Spill. P2: With the advancements in technology it should have created a safer environment for oil drilling. However, this does not seem to be the case, as this literature will point out, technology is only as reliable as the humans that operate it, as BP employees ignored several safety measures. The spectrums of oil spill problems are various and vast. They vary from environmental issue to economic, ecological, and ethical, politics and policies. Among several alternative oil spills, the BP oil spill within the Gulf of North American country, occurred in 2010 was recorded became the greatest environmental disaster in history. This paper targeted primarily on four aspects of the BP oil spill, the aspects of the environment and the impact with the BP crisis, as well as the Exxon Valdez oil spill. Some of the biggest impacts is the economic loss, offshore drilling policy issues, and how it affects waterborne commerce.

Currently the environmentalists are speech communication “we told you so”, pertaining to this crisis caused by an explosion on one in all these offshore drilling platforms in hand, by English company BP. The platform, in operation within the Gulf of Mexico, exploded when trying to faucet a replacement well. Many preventative and safety measures were unsuccessfully used. The first one being the “blowout preventer”, a tool designed to prevent back pressure surges from destroying the drilling mechanisms, up to and as well as the platform itself. Another item, a secondary relief well to alleviate these pressures were not in situ either. (Smith, Smith, and Ashcroft 2). The mixture of those and alternative factors has caused probably one in all the worst disasters in recent history. The eight-week disaster within the Gulf, with tens of thousands of gallons of oil still running from the broken well daily, threatening the setting and livelihoods of thousands of individuals across the coastal areas of Texas, Mississippi, Alabama and Florida. Those that were economic and socially affected vary from fishermen and coastal restaurants to grease rig staff who are placed out of labor for currently because of President Obama’s temporary stoppage of the ocean drilling.

Deepwater Horizon, one in all BP’s drilling rigs, had a blowout in April of 2010, that light-emitting diode to the foremost serious oil spill disaster within the Gulf of Mexico. According to reports, eleven staff was killed within the explosion, and fourteen individuals were injured. (Robertson, Krauss 18). On a daily basis, over hundred thousand barrels of oil were going into the ocean. The maximum amount of over 650,000 (sq). miles of the ocean were contaminated (Burdeau, Cain 4). This accident caused many robust issues together with environmental, political, economic and legal issues. The Deepwater Horizon oil spill (also spoken because the BP oil spill) is an oil spill within the Gulf of Mexico that flowed for over three months in 2010. It is the most important accidental marine oil spill within the history of the crude trade. The spill stemmed from a sea-floor oil well that resulted in an explosion of the Deepwater Horizon, which trained on the BP-operated Macondo Prospect. (Smith, Smith, Ashcroft 5) In July, the oil leak was eventually contained, by capping the gushing wellhead. Once it had free concerning over five million barrels of petroleum, and an estimated over 500,000 barrels per day on the loose from the well simply before it absolutely was capped.

It is believed that the daily rate diminished over time, beginning at concerning over 60,000 barrels per day, and decreasing because the reservoir of hydrocarbons feeding the oil well was bit by bit depleted.(Robertson, Krauss 4) In September 2010, the relief well method was with success completed, and therefore the central declared the well “effectively dead”. However, that was not the tip of it, the impacts of this oil spill unfold way and wide, affected the complete world oil and gas trade. According to recent scientific reports, they that the BP oil spill incident within the Gulf of Mexico is that the biggest oil disaster within the world. (Smith, Smith, Ashcroft 3) This Deep Horizon Disaster has substantially impacted the scheme of the Gulf region and lots of individuals were hit with monetary difficulties. This unfortunate incident has truly brought plenty of negative impacts to the world economy. The spill had a powerful economic impact to BP as additionally the Gulf Coast’s economy sectors like offshore drilling, fishing and business.

However, BP was not the first company to have an oil spill have detrimental impacts to the environment and to the economy. In March of 1989, Exxon Valdez was carrying millions of tanks of crude oil which severely ruptured and poured into the Gulf of Alaska. It was considered one of the most dreadful environmental disasters that pertained to oil drilling. The effects of the weather which carried heavy gusts of wind spread the oil furthered into the shorelines of the several other regions. The cleanup process was long and tedious which became challenging, as it would have long term damages to the ecosystem, wildlife, and the economy. The economics of commerce were profoundly impacted, as several industry jobs collapsed, and forced the government to pass the Oil Pollution Act of 1990, which forbidden oil drilling and vessels in the Prince William Sound Region, which help to prohibit 18 Exxon Ships since the ruling from drilling or sailing in the Alaska region (Pattern, Nance 411).

While previous studies have pointed that the pressure from the government would levy heavy regulations from the Exxon spill, what they also counted on was that it would also decrease the market values and trade. According to Patten and Nance (1998), “the Alaskan oil spill also triggered substantial increases in both wholesale and retail gasoline prices in the US immediately following the accident. It appears that the unexpected product price increase was interpreted as good news for the intra-industry firms.” The economic impact of commerce was rooted in its loss of fishery, stocks in fish particularly herring, salmon, and other trades. More critically it had intense pressure on international trade, and an increase in oil prices that saw a major jump in that time period. The technology for safer oil drilling was not available at the time, while Exxon Valdez protested that the vessels would be safe, the government did not believe in their capabilities. Exxon Valdez was one of the first to have a substantial catastrophe that contributed heavily to water pollution, due to the oil spill. The water pollution profoundly affected the commerce of trade, industry, and other sectors.

Implications

There are several financial implications of the two catastrophes to water pollution. These financial implications lead to billions in payouts, cleanup, and lawsuits filed from families, businesses, and the local governments. After the explosion which led to the oil spill, BP implemented several ways to stem the oil flow. The foremost winning technique was the method of placing a riser insertion tube into the wide burst pipe. In keeping with BP, its one-day oil recovery effort accounted for concerning for over 20,000 barrels of oil, and therefore the flaring off of over 55 million three-dimensional feet of gas. The cost of cleanup up the oil spill and compensating the victims will reach quite $20 billion. (White, 2010). BP has to pay the individuals suffering from the spill, however there are such a lot of individuals and interest teams being suffering from the incident. Additionally to cleanup, BP claimed that the corporate paid $399 million to settle 127,000 claims towards the end of 2010.

On BP’s expenditures on the spill enclosed the price of the spill reaction, containment, reprieve well drilling, grants to the Gulf States, claims paid, and fees paid to the federal government in penalties and fines. As of March 2012, BP, spent over $30 billion in cleanup and other expenses.  However, by some estimations penalties that BP is also needed to pay have reached as high as $90 billion. (Robertson Krauss 2) Additionally, in November 2012 the Environmental Protection Agency declared that BP are quickly prohibited from seeking new contracts with the United States government. Because of the loss of the value, BP had born from the second to the fourth largest of the four major oil firms by 2013. Throughout the crisis, BP gas stations within the US reportable sales off between ten and four-hundredth because of backlash against the corporate. There are several implications that can be seen about the way in which technology could have profoundly changed the way in which it would save the economy. While technology was not available at the time of Exxon Valdez, it was available during the BP Oil Spill, however, employees and workers on the platform did not follow safety measures. (Arata Picou, Johnson, 4) These implications of the lack of handling equipment and technology contributed to the disaster that has been the biggest in history since the Exxon Valdez disaster.

Limitations

There are several limitations on the research, as the oil spills in each situation placed considerable damage to the entire ecosystem. It is unsurmountable to estimate the costs to the economy which is affected by employment, the business sectors, and other financial implications. In doing this paper, the limitations can be seen on the extent of commerce, as not a lot of studies have been conducted on the impacts, as well, as how water pollution contributes to commerce. There is additionally a possible impact on the food safety within the gulf space. The fishing business may well be injured if customers are not assured within the food merchandise. The prohibition has helped keep tainted food off dinner tables; as a result, the food costs additionally went up. The retailers ought to pay above-market value for food from the Gulf Coast space. (Burdeau, Cain 4) The BP oil spill could value American state fishing trade up to $172 million. The fishing trade of American state could lose $115 million to $172 million in gross sales from 2011 to 2013. Additionally, the projected vary of job loss are two, 650 to 3,975 jobs (Burdeau, Cain 4). In keeping with the previous statistics, the Gulf fishing and business industries created a median annual financial gain of 5 billion for the past few years. Right once the oil spill incident, the annual financial gain for the year of 2010 has been reduced dramatically. The ocean water has been contaminated, and a majority of the ocean life were killed. The fishing trade is taken into account “dead” at the instant as a result of no one dares to eat food within the Gulf region. The food wholesalers have suffered immense losses. The environmental damages have nice potential to wreck the economy.

Conclusion

The lesson that can be learned from these oil spills directly relates to the employee’s training of the use of technology, and more importantly on measures of safety when it comes to working with sensitive technology. Technology advancement was essential in helping companies to adapt to safety protocols, and helping to make things better for corporation. However, this still did not help in the BP spill. That costs the company and the economy billions in losses, and expenses. Waterborne commerce is essential in international trade that will help in all aspects of business sectors. The oil spills contributed significantly to water pollution, and did a vast deal with the economy. BP and Exxon Valdez oil spills are the biggest in history, and they have had to pay out billions each to clean up the catastrophe socially, economically, politically, and in other ways. Water pollution is a serious problem, as much of the world is dependent on its resources, and water is vital to every living being on Earth, keeping it clean should be a priority. Waterborne commerce is an aspect that is not greatly discussed but is essential to the economy. The looking to research to establish a topic on which is relevant to the readers, it is pertinent to note the limitations, and the need for further research on the long term impacts to the economy and the environment.

Future Research

The oil spill additionally has future economic impacts from a public stand. Thanks to the pollution ensuing from the oil spill, fewer individuals would jaunt the Gulf Coast; the economy and jobs within the Gulf Coast region would even be hurt. In keeping with Family Travel Forum, BP has funded a promoting a program that helps attract guests to the Gold Coast region. The consequences of the BP oil spill on the Gulf Coast relating to traveling are possible to last concerning 3 years and price the region $22.7 billion (U.S. Travel Association, 2010). Those effects are long-run. The regime within the Gulf Coast Region needs to operate some promoting programs to draw in guests and businesses. The economic loss on business of the region cannot be lined by the travel insurance, as a result of the oil spill may be a manmade disaster rather than a natural disaster. Notably, the cruise trade within the Gulf Coast has been suffering from the oil spill. In addition to the loss of consumers, the ships ought to arrange their cruise schedules to avoid the contaminated space. Research can be expanded to discuss the effects of air pollution on international trade commerce, as it directly relates to the economy, as well as problems with pollution.

References

Arata, C. M., Picou, J. S., Johnson, G. D. and McNally, T. S. “Coping with technological disaster: An application of the conservation of resources model to the Exxon Valdez oil spill.” J. Traum. Stress, 13: 23–39. 2010.

Burdeau, Cain; Holbrook, Mohr. “Expert: BP Gulf Oil Spill.” Sky Truth. Associated Press. July 2010. Web. 1 May 2014. http://blog.skytruth.org/2010/07/bp-gulf-oil-spill-68000-square-miles-of.html.

Kerr, Richard A. “A Lot of Oil on the Loose, Not So Much to Be Found.” Science 329: 734. 10 August, 2010. Web. 1 May 2014. Article.

Patten, Dennis M., Nance, Jon R. “Regulatory cost effects in a good news environment: The intra-industry reaction to the Alaskan oil spill.” Journal of Accounting and Public Policy. Vol 17, Issues 4, pg. 409-428. Article.

Robertson C, Krauss C. “Gulf Spill Is the Largest of Its Kind, Scientists Say.” The New York Times. 2010. 1 May 2014 http://www.nytimes.com/2010/08/03/us/03spill.html?_r=1&fta=y.

Smith Jr., Lawrence C., Smith, L. Murphy, Ashcroft, Paul A. “Analysis of Environmental and Economic Damages From British Petroleum’s Deepwater Horizon Oil Spill.” Albany Review. 2011. Web. 1 May 2014. http://www.albanylawreview.org/Articles/Vol74_1/74.1.0015_SMITH.pdf