This presentation is prepared in the Macro-economy class to analyze the macro economic affect of the BP Deepwater Horizon oil spill. All the photos are found via Google search, copyright belong to the original authors. Logos came from the GreenPeace Logo contest

1. BP oil disaster’s
impact on the
US economy
Jonah Guo

2. Overview
 Disaster Brief
 Industry Impacts
 GDP impacts
 Summary

4. worst
"
environmental disaster
the US has faced"
-- Carol Browner,
White House energy adviser

5. Major impacts
Food
Fishing
Health Care
Tourism
Oil

6. 145,000 businesses and close to 1 million employees
STATE-WISE IMPACT (Business Closed) ON TOP INDUSTRIES
Courtesy: D&B, oil spill – Impact analysis

7. Tourism
 Over $22 billion lost revenue
from coastal tourism in the long-term
 Louisiana, had an
increase in business
visitor spending, due to
increase in media
presence and
government travel

8. Nationally is not likely seriously affected
 There are other places to go:

9. Fishing
Impact:
Alabama (40%), Mississippi (95%),
Florida (2%), Louisiana (55%)
Louisiana , the biggest seafood supplier in US,
could lose $2.5 billion
with 27,000 employees affected.
Only accounts for 1% state GDP

10. On the other hand,
 2/3 gulf remained open for fishing
 US imports 80% of seafood
Courtesy: NOAA Fisheries Service

11. Food
 Local restaurants primarily affected
 In 2011, FDA reported the seafood in the area
affected by the oil spill was safe.
Or maybe not?
Consumers still leery

12. Health Care
 Eleven workers died
 “Chemicals in crude oil and
dispersants can cause a wide range
of health effects in people and
wildlife, …damage every system in
the body,…even cancer.”
-- Wayne State University,
Gulf Oil Spill Health Hazards Report
 The possible health care cost
are unpredictable and could
be HUGE

13. Short-term Oil price remained
low and stable
• Well is exploratory, not for production
• 2/3 of US oil is imported
• 24,000
barrels per
day
(0.026%
of worldwide)

14. Long-term impact
Restricted policy on
offshore drilling could
harm new offshore
production.
Yet no regulations
have officially been
implemented so far.

15. True Economic Impact
 BP has fully paid Obama Administration
9 bills ($632 million total) for
response and recovery operations .

16. Thousands of Clean-up workers
offset losses in industry

17. Disclaimer
 Vast majority of information published
during the spill, projections were worst
case scenarios.
 Media/research firms
sensationalized
data
Just
like this
Logo
contest

18. GDP(=?)
Total US GDP in 2010 was $14.66 trillion
• Gulf coastal Quarterly % Change in US GDP
area only 6.0
accounts for 4.0
3% of national 2.0
GDP and 0.0
employment -2.0
-4.0
• Total loss Nominal GDP
less than -6.0
Real GDP
0.1% GDP
-8.0
-10.0
Source: Bureau of Economic Analysis

19. The cost of
ecology and environment
may be
huge

20. Questions?

21. Reference
 Logos Courtesy: Greenpeace
 Greener Media , Dark Horizon: A Documentary about the Gulf Oil Disaster http://vimeo.com/12737283
 D&B, “2010 Deepwater Horizon Oil Spill Report”
http://www.dnbgov.com/pdf/DNB_Gulf_Coast_Oil_Spill_Impact_Analysis.pdf (accessed June 12, 2011)
 IEM, “A Study off the Economic Impact of the Deepwater Horizon Oil Spills”http://www.uflib.ufl.edu/docs/Economic
Impact Study, Part I - Full Report.pdf (accessed June 12, 2011)
 TreeHugger.com, “BP Gulf Oil Spill's Impact on Tourism Estimated at 3 Years, Nearly $23
Billion”http://www.treehugger.com/files/2010/07/bp-gulf-oil-spill-impact-tourism-oxford-travel.php (accessed June 12, 2011)
 CBC, “BP oil spill: 1 year later”http://www.cbc.ca/news/technology/story/2011/04/15/f-gulf-spill-one-year-later.html
(accessed June 12, 2011)
 Reuters, “Factbox: Gulf oil spill impacts fisheries, wildlife, tourism”http://www.reuters.com/article/2010/05/30/us-oil-rig-
impact-factbox-idUSTRE64T23R20100530 (accessed June 12, 2011)
 Business Monitor International, “United States Tourism Report Q2 2011”, Published in April, 2011
http://www.bizreportshop.com/product/bmi/United-States-Tourism-Report-Q2-2011_177900.html (accessed June 12, 2011)
 Harold F. Upton, Congressional Research Service,“The Deepwater Horizon Oil Spill and the Gulf of Mexico Fishing
Industry”, published in February, 2011 http://www.fas.org/sgp/crs/misc/R41640.pdf (accessed June 12, 2011)
 How Did BP Gulf Oil Spill Effect Gulf Fishing Industry Charthttp://hubpages.com/hub/Gulf-fishing (accessed June 12, 2011)
 Daily Finance, “BP Oil Spill Creates a Wave of New Jobs, Takes Others
Under”http://www.dailyfinance.com/2010/06/01/oil-spill-jobs/ (accessed June 12, 2011)
 Heatingoil.com, “BP Oil Spill Will Raise Oil Prices—in 2015”http://www.heatingoil.com/blog/bp-oil-spill-will-raise-oil-
prices%E2%80%94in-2015603/
 Medill Reports, “Why hasn't BP's oil spill caused oil prices to
skyrocket?”http://news.medill.northwestern.edu/chicago/news.aspx?id=166157

22. Thank You for listening!
Jonah Guo
Queen’s MBA 2012
Canada
www.Jonahguo.com
jonahguo@gmail.com