BP (NYSE: BP) recently announced that the energy giant would pay allnecessary and appropriate clean-up costs from the Gulf oil spill.
Not sure if that was a reaction to the "stern warning" from the White House, or simply something some unlucky PR schlub had to pump out tothe media in an attempt to try and calm the masses…Either way, most folks could give a rat’s ass what BP says. It’ll be all about what they do. That will be the test.
Because let’s face it, after the 1989 Valdez disaster, the word of an oil company is about as reliable as the gas pedal on a recalled Toyota(NYSE: TM) Corolla. Sure, Exxon (NYSE: XOM) did pony up a huge wad of cash to clean uptheir mess in Prince William Sound — after many, many legal battles.But as recent as last year, the company was still dragging its feet onsafety.
Some Never Learn, and Some Just Don’t Give a Damn
Across the globe, 151 countries have decided to ban single-hullvessels by 2015 because, according to experts, two hulls are better than one for preventing oil spills.
The EU actually stated that the single-hull design is simply moreaccident-prone. Interestingly enough, BP won’t even use them because of the leaking risk.
Today, about 80 percent of the world supertanker fleet has beenreplaced with double-hull vessels. But last year, it was reported thatExxon was still using the single-hull; apparently, the single-hullvessels are about 20 percent cheaper to hire.
Under the U.S. Oil Pollution Act of 1990, single-hull tankers are permitted to move through waters to unload atthe Louisiana Offshore Oil Port until 2015.
Let’s just hope one of those single-hull dinosaurs doesn’t rip openlike a sardine can within the next four and half years.
Take a Long, Hard Look. . .
Let’s face it: the only reason Obama dangled that offshore carrot was to lure a few Republicans to a place where some meaningful legislationcould be hammered out. But with this latest spill, everything is onhold.
Last week, the President called for a thorough review within 30 daysthat would provide precautions necessary to prevent another incidentlike this from happening… which makes you wonder, why wasn’t athorough investigation undertaken before this happened?
Not a single Senator claiming to be an environmental crusader hasever stepped into those unpopular waters — until now.
And I won’t even get into those folks in Washington who damned theutterance of stronger federal regulations on drilling, but are nowbegging for federal assistance to clean up this mess. I guess BobbyJindal couldn’t get enough coffee can donations from locals to fix thisproblem.
Meanwhile, both jack ass and elephant are positioning for what couldbe a backlash against oil drilling. This could be a problem for bothsides, as you’ll get no expansion of solar, wind, or electric vehicleswithout expanded offshore oil concessions.
Personally, I don’t see anyone putting the kibosh on offshore oil.Sadly, most folks will forget about this by the end of the month, butthey will see the price at the pump every week.
So for investors concerned about this spill derailing an energy andclimate change bill that includes offshore drilling… I wouldn’t losesleep over it.
In some shape or form, a new energy or climate change bill will beintroduced, debated, and passed.