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The Worst Disaster Since We Entered the Newsroom

May 4, 2010

I went out of pocket on Friday and just got back to the computer today, but I wasn’t missing the news.  When I left, the oil rig fire had just turned into an oil leak, and nobody was in “news panic” mode yet.  The Lovely Wife and I discussed the spill a fair amount over the long weekend, with me always reverting to: It’s not going to be as bad as the news is making it out to be.  Yes, it’s not good, but it’s not the end of the world.  Here’s more detail on that opinion from the NY Times yesterday morning.

The ruptured well, currently pouring an estimated 210,000 gallons of oil a day into the gulf, could flow for years and still not begin to approach the 36 billion gallons of oil spilled by retreating Iraqi forces when they left Kuwait in 1991. It is not yet close to the magnitude of the Ixtoc I blowout in the Bay of Campeche in Mexico in 1979, which spilled an estimated 140 million gallons of crude before the gusher could be stopped.

And it will have to get much worse before it approaches the impact of the Exxon Valdez accident of 1989, which contaminated 1,300 miles of largely untouched shoreline and killed tens of thousands of seabirds, otters and seals along with 250 eagles and 22 killer whales.

So yes, this is going to be potentially bad, especially in the open ocean where we can’t really see the impact (the article notes that).  But we also have over two decades of experience in cleaning up spills with new technology that will help to mitigate things.  For now, the biggest impact is to the Gulf fisheries, and that could be hundreds of millions of dollars.  The financial impact to the oil industry will be in the billions, most of which will come from BP, at least to start.  But billions isn’t that bad in comparison to the impact that rising gas prices from hesitant energy policy and general public panic will cause.

In reality, most of the oil leaked into the water comes from natural seepage, and that’s much greater than what we’re seeing here.  In terms of near-shore spills, it’s more likely that leaky boat engines and bad maintenance practices dump more onto the shoreline this year than the spill will.  But this is a focused problem with a company everyone loves to hate involved, and it’s getting some misinformed press to help.

I’ll want to look at this in the long term.  However, I’m optimistic that the Gulf will come out okay in the end, and the technology runs will help spills in the future.  We’ll see how bad it gets when something actually happens.

Updated: Jonah Goldberg is much more eloquent than I am about the unintended consequences in his USA Today article:

The point here isn’t to minimize what is a true disaster. But already, politicians are reversing their support for drilling based on little more than what they see on the TV. It’s funny how everyone’s against setting policy in a climate of fear — unless the fear produces his preferred policy. The Three Mile Island nuclear mishap in 1979 caused America to stop building reactors for a generation because we let media hype set the policy. It would be a tragedy if we let the same thing happen with domestic oil drilling. Indeed, one irony is that America could stop drilling tomorrow and that would likely increase the number of spills worldwide, given that more environmentally lax countries wouldn’t stop their efforts and we’d get more oil via tankers, which are more likely to spill than oil rigs, and the less oil we produce, the more we have to import by ship.

Updated 5/5: Thanks to Cassy for the link.  She’s been doing great work monitoring the Navy Seal hearings.  Go read her blog often.

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