THE OIL giant BP has bowed to the inevitable and agreed to put $20 billion into a fund to compensate the victims of the Gulf of Mexico oil spill. The fund is a lot more than BP had intended to set aside and, unlike its proposal, it will be independently overseen.
President Obama’s administration will portray BP’s climbdown as a victory but the events of the last two months since oil gushed out of control from the Deepwater Horizon well one mile beneath the Gulf have not reflected well on any of those involved. Mr Obama failed to demonstrate sufficient concern at the outset and even as the enormity of the catastrophe sank in his response was ineffectual. Motivated eventually, his critics would say, more by worrying polls than ecological damage, he decided he needed “an ass to kick” and BP was summoned to the White House.
BP’s culpabilities in the matter takes one’ s breath away. A company which made profits of $26 billion last year unashamedly cut corners on safety on a very deep and risky well so that profits would be even higher. Previously, its own managers warned BP, in writing, that company safety rules were being ignored. Experts on the rig urged BP to install 21 cement-sealing safety devices. Instead, only six were ordered. BP’s chief executive claimed that damage from the oil would be “very, very modest” and complained that he would like “to get his life back”. BP’s chairman went on holiday.
But BP isn’t the only villain. The US regulatory authorities supposed to be overseeing the exploration were too close to the company and not doing their job. Mr Obama, earlier this year, decided to greatly expand offshore exploration without confirming that industry safety standards were up to scratch. And it seems clear that if it had not been BP that sank the well, its rivals would have been no better prepared for the consequences of a blow-out.
As the members of Congress pointed out, the plans of the other oil giants for damage control in Gulf drilling mishaps were just as outdated and ill-informed as those of BP.
Mr Obama, has called on Americans to join a “national mission” to move away from reliance on oil and develop alternative sources of energy. Some chance of that happening, given the deep pockets and unrivalled influence of the oil giants.
There is though one consolation from this disaster. It happened on America’s coastline. The damage that can be reversed will be. If it had happened off the west coast of Africa (as it has in smaller scale) nothing would have been done.