10312014Headline:

New Orleans, Louisiana

HomeLouisianaNew Orleans

Email Tom Young Tom Young on LinkedIn Tom Young on Twitter Tom Young on Facebook Tom Young on Avvo Tom Young on Google Plus
Tom Young
Tom Young
Attorney • (813) 251-9706

BP’s Oil Spill: A Gulf Coast Economic Tsunami

2 comments

In recent weeks, BP has come out swinging with full page advertisements in major newspapers like the Wall Street Journal and New York Times, questioning the scope of economic damage caused by its 2010 Deepwater Horizon Oil Spill.

The company has attacked the judge overseeing the Settlement Agreement that BP itself drafted. Attacked the claims administrator who is charged with processing and paying business economic loss claimants under the terms of BP’s contract. And most egregiously, attacked the businesses and people of the Gulf who filed claims pursuant to BP’s compensation rules and in reliance upon the company’s word.

It seems as though the oil spill bill is simply growing larger than BP anticipated and now the company is looking for any way out of its obligation and hollow “Commitment to the Gulf.” Citing a handful of claims (out of approximately 80,000 filed) in which the company feels the claimant is being overpaid, BP insinuates that the spill had little lasting economic impact on the region and that we should just get over it.

Stones Cause Ripples, Boulders Cause Waves

Economists often use the analogy of a stone tossed into a pond which causes outward flowing ripples to explain how a particular event affects the larger economy. Hence, the “Ripple Effect.”

The Deepwater Horizon blowout and subsequent oil spill was more akin to hurling a boulder into the pond. The subsequent waves impacted every industry in the Gulf Region. While the tourism, food service, seafood and construction fields took direct hits from BP’s boulder, hundreds of industries located many miles inland suffered from the secondary effects of the resultant waves.

In a report filed with the Court by Class Counsel on December 17, 2013, Dr. Timothy Ryan, Ph.D., Economics, cites empirical data which confirms that every major industry within the Settlement Agreement’s compensation zone suffered economic losses, many of which were profound, as a result of the Deepwater Horizon Oil Spill. Dr. Ryan states that his analysis “indicates a much more pervasive negative impact than that claimed by attorneys for BP.”

In fact, of the 96 industries studied, not a single one escaped unscathed. Accordingly, Dr. Ryan says that:

“the results of the [study] clearly indicate that the spill had a negative impact throughout local and state economies, no matter how far removed the sector may seem to be from the directly impacted sectors. This result suggests that the oil spill had an impact on all businesses in [the region].”

2 Comments

Have an opinion about this post? Please consider leaving a comment or subscribing to the feed to have future articles delivered to your feed reader.

  1. Eyeswideopen says:
    up arrow

    Just to update you the Opt-Out options provided by the settlement here’s the current stats. For those who opted out or not considered class members and elected to filed with BP the latest report shows Individuals & Businesses claims paid $10,449,792.00

    http://www.bp.com/content/dam/bp/pdf/gulf-of-mexico/Public_Report_November_2013.pdf