Economics

Economics

The term oil denotes petroleum products chiefly composed of hydrocarbons and existing in diverse volatility ranges. Oil spills occur frequently and are a major cause of ecological and aquatic pollution. This is because the properties of oil result into toxicity and tainting features. The effects are further propounded by the sensitivity of the biological life to hydrocarbon constituents. Majority of oil spills occur in the oceans and seas. Moreover, it is worth noting that there are other ways of  oil spill causes, for instance when the equipment breaks down, the tanker is likely to get stuck on shallow land and the only way of reinstating it is through putting a hole in the tanker and this causes oil leak. Secondly, countries at war might opt to dump gallons of oil and other harmful deposits in the enemy zones. Thirdly, terrorists also form part of the oil leak causation to a nation’s ocean with the sole aim of attracting attention and trying to communicate something to the victimized country. Lastly, natural disasters like hurricanes on the ocean may cause an oil spill. When a hurricane is a couple of miles away, the winds may cause a tanker to flip over thus causing an oil spill (Thomas, 2010).

A single pint of oil has the ability of spreading into a film that covers an acre of water surface area hence degrading the environment and eventually threatening human health. In order to support conformity to the laws prohibiting the discharge of oil, government agencies usually increase monitoring activities to ensure that offenders are wedged and punished. In addition, penalty for a violations are as well hiked. On April 20, 2010, an explosion which took place on the semi-submersible offshore drilling rig Deepwater Horizon in the Gulf of Mexico killed 11 rig workers and injured 17 others. Investigations on April 24 found that there was damage in the well-head that caused oil leak into the gulf (Peter & Nancius, 2010).

Who is to blame for the Gulf of Mexico leak? British Petroleum was the main operator behind the scenes and even though the firm is justified to be blamed for the oil spill and its impact to the environment, it is informative to speculate beyond the level of the immediate cause and reflect on how the pattern of events related to the spill came about. According to disaster management experts, it would necessitate rather a weird chain of events to produce a scenario that would give an explanation regarding one technical and strategy malfunction by a private business that could bring down a regional economy (U.S. Environmental Protection Agency, 2010).

What is the impact of oil spill to the economy and the environment? Drilling in deep offshore waters is fraught with hazards that require refined prevention and mitigation technologies. Therefore incase of an oil spill adverse effects are evident. An oil spill can have a number of direct and indirect effects on fisheries. It is worth noting that valuable fishing and shellfish areas are likely to be closed for fishing for longer periods after the oil spill under the risk of the catches made being tainted by the oil. In addition, concentrations of petroleum contaminants in the marine species like fish is likely to cause significant  adverse health effects to human health since they are the consumers of these species. Based on this, the economy may be stagnated since more efforts would be geared towards curbing human consumption, which brings revenue to the government (Allen, 1999).

Moreover, the fisheries sector is likely to experience heavy losses when consumers are stopped from buying aquatic products from the region affected by the spill. For instance, most fishermen from the gulf of Mexico were counting losses since their boats could no longer sail well in the waters due to the increased density thus as a result the fish production would deteriorate. A forum on high-density oil reaction concluded that sunken heavy fuel oil may is likely to cause significant impact on seabed resources and fishing and marine related culture actions (Johnson, 2008).

The tourism and recreation sector of the economy is not spared by the oil spill either. The pollution of the shoreline with oils is a common characteristic associated with nearly all the oil spills. There is a likelihood that the attractive coastal beaches and resorts will be affected, which raises the need for restriction of  recreational activities such as boating, diving, bathing and angling among others for specified longer periods of time until the mess is cleared. As a result, the people engaged in such lucrative business may suffer significant economic losses. These include hotel and restaurant owners, and numerous others who earn from recreational activities in the coastal zones such as boat renters, diving tour instructors, among others. The government may also lose its share of revenue from taxes generated by the tourism sector (Zacheus, 2002).

Most industries located along the coastlines require clean water from the ocean for industrial purposes such as processing and cleaning of raw materials before manufacture, others require fresh streams for cooling purposes in nuclear and extra-power plants and desalination plants. It is obvious that oil leakage into these sources of water that includes oceans and seas may negatively affect the facilities in the industries, which results into delayed production or a stop in manufacturing of the products. This is due to oil getting into the water intake pipes that lead to the factories. In addition more effects include contamination of piping systems, which in turn may require that the plant is shut down during the cleaning process. The government sectors that rely on these industries such as power supply may suffer losses as well, thus the economy as a whole comes into jeopardy (Cameline, 2009).

            One may also ask; how does an oil spill act distress human health? Oil leakage has unpleasant effects on the human health too. It is worth noting that people’s health and personal safety is threatened by oils either through inhaling, touching oil products or the moment an individual consumes contaminated sea food. Nevertheless, absorption of petroleum contaminants in fish and crab tissue is likely to cause significant potential health problems for consumers. Therefore the government intervenes and halts production and consumption of such merchandise until they are cleared by the health authorities. It is observable that oil-tainted fish and shellfish usually have a bad taste, which prevents people from eating these products. The lasting consequences of such an action would mean that the government may lose sub-sequential revenue from the distribution and marketing of the same. Moreover, the people who rely on sea food for survival and treatment of inherited diseases like cancer may lose as well (Humphrey & Marion, 2003).

During clean-ups, it is advisable for one to take the necessary precautions during the clean-up to avoid these dangerous exposures. One is expected to put on a face mask or filter mask that protects the individual from inhaling vapors from oils. Protective clothing that includes waterproof gloves and clothes that cover the body frontage, as well as strong rubber boots is also a necessity to avoid getting skin contact with the oil. The same safety measures and ideologies should be applied to revelers who handle the risk of enduring oil on beaches. It is very important that one should avoid touching it as much as possible since it may cause death or breakdown of normal body functions thus incurring heavy bills in hospitals and care centers (Christopher & Anne, 2004).

            When oil spills out, it spreads very rapidly through the help of currents and wind. Researchers argue that a single gallon of oil can cause an oil slick-up to a couple of acres in area. For instance, the recent oil lick by British petroleum vessel in the Mexican gulf spread over 580 square miles in just three days. One can note that, the moment the water starts mixing with the water, there is a change in its composition generating a sticky substance called mousse. This stuff has the capability of clinging to every substance that it comes into contact with, thus quite a number of marine animals do not have the power and tricks of how to avoid the mousse. As a result, some fish may even be attracted to since it also resembles food and once it sticks to the body it becomes a problem. With these details, it is therefore possible to determine the rate with which the wildlife and aquatic animals fall victims of the health hazard (U.S. Environmental Protection Agency, 2007).

There are various effects that animals suffer as a result of coming into contact with crude oil. When the oil breaks down the insulating capabilities of feathers due to too much mousse, the feathers become heavier and compromise the flying capability and this result to hypothermia and drowning of birds. In addition, when the oil is ingested accidentally, it poses a risk of either absolutely poisoning the animal or making the species extremely sick to a point of dieing. The level of toxins in oil is so high such that the moment they penetrate into the body system, they alter the food chain causing a sudden failure in the circulation of oxygenated blood. It is worth noting that shell-fish and corals are particularly at risk in these scenarios since they are not able to escape from an oil slick (Samuel &Gibson, 1999).

Animals and birds further suffer damage of airways since the oil emits some gases upon its contact with the atmospheric layers thus the breathing system of these species stands at risk. The economic loss in this is that some of the birds are sources of tourist attractions and the moment they start becoming extinct due to such dangerous exposures, the revenue earned will deteriorate. The immune system is also damaged by the toxins present in the oil segments the moment they get into contact with sensitive body parts. This results to animals and birds becoming vulnerable to diseases that can otherwise be avoided if there was no oil spill (Christopher & Anne, 2004).

There is interruption of breeding and fouling of breeding grounds for animals and birds whose habitat is near the ocean or coastlines. For instance, animals like eels carry-out their breeding at the sea bends, so the moment the oil slick covers that ecological zone; it may affect the species by either killing the new-born or preventing the optimum conditions for safer bleeding thus a reduction in population. The relationship of these ecological weaknesses to the economy is that, there will be a loss in aquaculture that acts as a prestige to the nation’s image. Moreover, one should also take into consideration that oil presence into the body system may as well cause thinner bird and turtle egg shells and also damage the fish larvae, causing deformities (The Guardian, 2001).

Sea grass beads and other shelter and feeding areas are also damaged by the oil sleek, this is due to blockage of the factors that supports growth, which include light an air thus the grass withers away. The shelters for sea species such as turtles also face the risk of destruction since the mousse covers each and everything that it comes across as it spreads. Algae are known for performing a vital role in water way eco-systems and the oil spill taint them to a point of demise thus the general ecological setting becomes distorted. The economic sector suffers a break-down in devising financial strategies to curb the oil spill from spreading deeper into the bionetwork (Jamal, 1998).

Scientists argue that oil does not necessarily have to be sticky so as to jeopardize wildlife. Studies have revealed that both non-sticky oils such as refined petroleum products and sticky oils such as bunker fuels and crude oil affect different wildlife according to the habitats that they live. Polished petroleum products do not take longer periods in the marine environment as compared to crude or bunker fuel but they are seen to be much more poisonous than the rest. It is observed that birds become dehydrated and eventually starve due to reduction in drinking, diving and swimming in search for food. Notable irritation or contagion in dugongs and difficulty in eating is due to oil sticking in the sensory hairs around the mouths of these species (Beatrice, 1990).

Sometimes the oil appears to have dissolute but it can still lurk beneath the facade of beaches and the sea bed thus harshly affecting marine organisms that hide in there such as crabs for longer periods of time. The burrowing creatures serve as food to other animals and therefore the cycle of poisoning continues for long. One can point-out that there is no aspect of a marine and coastal environment that is not adversely affected by an oil spill. Based on that, an individual can conclude that the faster the spill occurs to the shoreline, the more marked the damage becomes to coastal zones being home to more concentrated and diverse populations of marine, bird and other animals thus a slap to the economy (Matthew, 1989).

How are nations supposed to prevent future oil spills? Scientists argue that evaluating data on conformity and enforcement is a hard assignment. It is worth noting that reported increase in enforcement activities usually indicate more frequent spills, but could as well replicate better monitoring and more dynamic examination of sea activities. Experimental studies are supposed to be designed with care to sort-out the effect that variables have on actual spill occurrence versus spill discovery. Moreover, is has been discovered that monitoring oil transfer operations is effective in reducing oil spill volumes. This is implemented through random port patrols that search for oil sheens, which encompass similar influence since they raise the likelihood of detection for all vessels entering a particular port (U.S. Environmental Protection Agency, 2005).

            Substitute approaches can be employed as well since administrational monitoring sometimes proves to be costly. The three alternatives that have been hardened include; targeted monitoring for vessels, which are perceived to be out of conformity or likely to spill oil. Secondly, the authorities should set discrepancy penalties that are based on prior compliance accounts. This means that higher penalties would be slapped to recurrent violators. Lastly, adoption of obligatory report sheets for operators who fail to report any spills in the vessels. These measures suggest that firms may work hard to regain trustworthiness with the government (The Guardian, 2007).

            In conclusion, a firm’s reputation may be improved whenever information regarding its efforts in passing sanctions for violating environmental laws is spread. This may create interest to shareholders or lenders if the monetary sanction reduces the expected value of the firm and therefore its share price or bond rating rises. For instance, British petroleum should reinstate the consumer confidence to attract majority of shareholders especially after the April oil spill in the Mexican gulf. Numerous studies looking at horrific ecological news, such as oil spills demonstrate a negative stock price effect (U.S. Environmental Protection Agency, 2006)

Bibliography:

American Petroleum Institute. Fate of Spilled Oil in Marine Waters. Washington, D.C.: American Petroleum Institute, 1999. Print.

Andrew, B. & Fleming, A. Implication of Psychological Research on Stress and Technological Accidents. Ringwood, Vic: Penguin, 2000. Print.

Arata, C. M., Picou, J. S. Johnson, G. D. and McNally, T. S. Coping with Technological Disasters: An Application of the Conservation of Resources Model to the Exxon Valdez Oil Spill. Journal of Traumatic Stress, 2000. Print.

Boesch, D. F. & Rabalais, N. N. Long-term Environmental Effects of Offshore oil and gas Development. Washington, GA: Taylor & Francis, 1987. Print.

Burger, J. Before and after an oil spill: the Arthur Kill. Piscataway, NJ: Rutgers University Press, 1994. Print.

Cohen, M.A. Optimal Enforcement Strategy to Prevent Oil Spills: An Application of a Principal-Agent Model with “Moral Hazard.” Journal of Law and Economics 30: 23, 1999. Print.

Cohen, M. A. Oil Spills: the deterrent effects of monitoring, enforcement, and public information. Resources Magazine, 2009. Print.

Cohen, M. A. Oil Spills: the deterrent effects of monitoring, enforcement, and public information. Web. April 20, 2009

Drabek, T. E. Human System Responses to Disaster: An Inventory of Sociological Findings. New York: Springer-Verlag. 1986. Print.

Freedman, B. Environmental ecology: the ecological effects of pollution & disturbance. Camp Hill, PA: Academic Press, 1995. Print.

Green Living Tips 2007: Effects of oil spills. Web, 06 June, /2010 http://www.greenlivingtips.com/blogs/164/Effects-of-oil-spills.html

Heron, S.F. How Does an Oil Spill Affect The Environment? Education Review 37.1 (2002) Web, 11 Apr. 2002

http://www.ehow.com/how-does_4616883_oil-spill-affect-environment.html

Natural Hazards Center. Learning from Catastrophe: Quick Response Research in the Wake of Hurricane Katrina. Boulder, CO. 2006. Print.

Natural Hazards Center. Learning from Catastrophe: Quick Response Research in the Wake of Hurricane Katrina. Boulder: University of Colorado at Boulder. 2006. Print.

Steven, P. J. In Search of a Public Environmental Sociology: Ecological Risks In the Modern World. New York: Springer-Verlag. 2008. Print.

Steven, P. J. In Search of a Public Environmental Sociology: Ecological Risks In the Modern World. New York: Springer-Verlag. 2008. Print.

Thomas A. After Disaster: Agenda Setting, Public Policy and Focusing Events. Washington: Georgetown University Press. 1997. Print.

U.S. Environmental Protection Agency. Understanding Oil Spills and Oil Spill Response. Washington, D.C.: U.S. Environmental Protection Agency, 1993. Print.

Weber, J.M., R.E. Crew. Deterrence Theory and Marine Oil Spills: Do Coast Guard Civil Penalties Deter Pollution? Journal of Environmental Management 58: 161, 2000. Print.

Wells, P. G., Butler, J. N. & Hughes, J. S. Exxon Valdez oil spill: fate and effects in Alaskan waters. Pennsylvania, US: ASTM International, 1995. Print.

 

Are you looking for a similar paper or any other quality academic essay? Then look no further. Our research paper writing service is what you require. Our team of experienced writers is on standby to deliver to you an original paper as per your specified instructions with zero plagiarism guaranteed. This is the perfect way you can prepare your own unique academic paper and score the grades you deserve.

Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.