Join the Socialist Party Join us today!

Printable version Printable version

Facebook   Twitter

Link to this page: http://www.socialistparty.org.uk/issue/629/9826

From The Socialist newspaper, 16 June 2010

BP's value plunges as oil spill worsens

Birds killed as a result of oil from the Exxon Valdez spill, photo Exxon Valdez Oil Spill Trustee Council.

Birds killed as a result of oil from the Exxon Valdez spill, photo Exxon Valdez Oil Spill Trustee Council.   (Click to enlarge)

AN ESTIMATED 40,000 barrels (1.7 million gallons) of oil a day may have been gushing out from the BP leased Deepwater Horizon oil rig since it blew up and sank in the Gulf of Mexico on 20 April - a doubling of earlier estimates.

This amount is equivalent to the 1989 Exxon Valdez oil tanker disaster in Alaska flowing into the Gulf of Mexico every eight to ten days.

The oil outflow is also exceeding BP's current processing capacity of around 25,000 barrels a day, following the placing of a cap over the damaged well.

The disaster is widely blamed on the oil giant BP for a series of safety lapses, set against a backdrop of cost cutting and outsourcing measures by the world's third richest oil giant.

Until the disaster BP had enjoyed a cosy relationship with the White House, notwithstanding a fatal accident at BP's Texas City refinery in 2005.

Now, BP has come under a barrage of public criticism by president Barack Obama. The US Justice Department said on 9 June that it was planning to take action to force BP to withhold its next dividend payment. US politicians are demanding that BP immediately put $20 billion into a ring-fenced fund to clean up the spill.

BP is said to be trying to get the US government to ease its criticisms of the company in return for voluntarily withholding a dividend payment.

This has set alarm bells ringing on stock markets where shares in BP have slumped 40% since the disaster began. The National Association of Pension Funds estimates that UK pension funds' exposure to BP is about 1.5% of total assets.

But Obama's bark may prove to be fiercer than his bite since US investors (who own 39% of BP, including 25 institutional and 14 big individual investors) receive $4 billion of income a year from BP. In fact, BP is integral to the US's energy infrastructure (BP merged with the US oil company Amoco in 1998). The company employs 29,000 workers in the US (out of a worldwide total of 80,300) and gives the federal authorities large tax cheques.

Blameworthy though BP is, Obama and other politicians are being hypocritical over criticising BP's operational failures, as it was US regulatory agencies that routinely granted oil companies permits for risky deepwater drilling. Only one month before the Gulf disaster Obama's administration announced the expansion of offshore drilling for oil, previously banned after the Exxon Valdez incident.

The clean-up operation has so far cost BP over 1 billion, while the bill for the Gulf clear-up, including fines and compensation, could eventually reach 22 billion.

However, as one of the richest oil companies in the world, BP made profits of 16 billion and paid dividends totalling almost 7 billion in 2009. Even after its recent share price slump, BP's market capitalisation still stands at 73.6 billion.

Moreover, ExxonMobil only ended up paying a $507 million settlement for the 1989 Exxon Valdez disaster. In June 2008 the US Supreme Court ruled that the $2.5 billion in punitive damages awarded to 32,000 fishermen and property owners was "excessive".


For more on Big Oil and the environment see Gulf of Mexico disaster: nationalise the oil giants

Why not click here to join the Socialist Party, or click here to donate to the Socialist Party.


In The Socialist 16 June 2010:

Millionaire ministers savage public services

'Bloodbath budget' day protests and meetings


Education

Comprehensive education under attack

Opposing 'Dickensian' academy schools in Waltham Forest


National Shop Stewards Network

Come to the NSSN conference

Unison local government conference: Delegates face huge struggles

Northern Rock throws workers on the dole

Wales Unison: Socialist Party member elected

NHS Scotland - ConDemned to terminal decay

Southampton library staff strike to save jobs

Save the Big House


Socialist Party editorial

Labour leadership contest dominated by right wing


Socialist Party news and analysis

TUSC plans for future elections

BP's value plunges as oil spill worsens

Willetts approves tuition fees hike

Bloody Sunday report appears 38 years late

IDS's 'anti-poverty drive' attacks the poorest!

High speed trains and high priced fares

Why we don't back the Queen's pay claim

Fast news

Diary dates


Anti-racism

Tower Hamlets: Jobs, homes and services - not the racist EDL!


International socialist news and analysis

Greece: A test bed for 'austerity' and resistance

Spain: Millions of public sector workers strike over brutal cuts

Portugal: Mobilisation against austerity reaches new level

Socialist Party Scotland launched at packed and inspiring meeting


 

Home   |   The Socialist 16 June 2010   |   Join the Socialist Party

Subscribe   |   Donate  




Related links:

BP:

triangle2016 hottest year on record, air poisonous

triangleFilm review: Deepwater Horizon

triangleBeyond the Pale - capitalism and the environment

triangleLooking after the millionaires, not the millions

Oil:

triangleHurricane Harvey: A tragedy made far worse by capitalism

triangleTories and Blairites in pockets of big business: kick them out!

triangleTory oil spoils v poisonous air

US:

triangleSwansea Socialist Party: Mother Jones - A US labour pioneer

triangleJoin the Orgreave Halloween rally

triangleTheresa May, Frida Kahlo and turning women into wares

Obama:

triangleSolidarity not racism - Socialism not Trumpism

triangleBuild 100 days of resistance to Trump's agenda!

Reports and campaigns

Reports and campaigns

12/10/17

Cleaners

Justice for Tube cleaners demo

11/10/17

Salford

Salford Unison condemns pay cuts

11/10/17

Royal Mail

CWU fights court attempt to stop national strike

11/10/17

Carlisle

Carlisle NHS campaigners hand in petition to MP

11/10/17

Green

Don't wreck our rec! Campaigning to save green space in Standish

11/10/17

Fire

No more fire deaths - ensure safety now!

11/10/17

Cardiff

Cardiff Socialist Students confront 'Parasite' Jacob Rees-Mogg

11/10/17

John McDonnell

Manchester rally discussed unionisation and nationalisation

11/10/17

Orgreave

Join the Orgreave Halloween rally

11/10/17

Union

Workplace news in brief

11/10/17

Democratic rights

Who's watching who?: The fight for justice, trade union and democratic rights

6/10/17

Northern Ireland

Boeing bust-up threatens thousands of skilled jobs

5/10/17

Runcorn

Too much to cross the Mersey

4/10/17

Royal Mail

Set for national strike action

4/10/17

London

Supporting the general strike in Catalonia

triangleMore Reports and campaigns articles...


Join the Socialist Party
Subscribe to Socialist Party publications
Donate to the Socialist Party

triangle13 Oct The end of the Tories?

triangle11 Oct Nasty party imploding...drive out the Tories

triangle11 Oct CWU fights court attempt to stop national strike

triangle11 Oct The fight against racial discrimination is tied to fighting against...

triangle11 Oct Catalonia: Workers can finish what Puigdemont won't

triangle6 Oct Boeing bust-up threatens thousands of skilled jobs

triangle4 Oct The nasty party turns on itself... but the Tories must be driven out

More ...

triangle16 Oct Teesside Socialist Party: After the party conferences

triangle17 Oct London: TUC lobby & rally; and London march

triangle18 Oct Warrington & St Helens Socialist Party: 1917-2017; the October Russian Revolution

triangle18 Oct Hackney Socialist Party: 100 years ago - the Bolshevik-led revolution

More ...

Socialist Party Facebook page
Socialist Party on Twitter
Visit us on Youtube

Archive

Archives:

October 2017

September 2017

August 2017

July 2017

June 2017

May 2017

April 2017

March 2017

February 2017

January 2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

Legal

SP RSS feed RSS

Platform setting: = No platform choice

V2