US President Obama has televised his tough stance against BP as oil continues to leak into the Gulf of Mexico. But it's unclear what legal mechanisms he can use to force the company to pay full compensation.
US President Barack Obama addressed the Gulf of Mexico oil spill on television
Ahead of a meeting with BP executives on Wednesday, US President Barack Obama adopted a tough tone in a speech televised from the White House.
Tuesday's speech came as efforts to staunch crude oil flowing from an underwater well in the Gulf of Mexico only partially succeeded more than six weeks after the now infamous sinking of the Deepwater Horizon oil rig.
Obama called the spill a lasting "epidemic" and the "worst environmental disaster America has ever faced." He said he would demand that BP chairman Carl-Henric Svanberg set up an independently controlled fund to compensate "the workers and business owners who have been harmed as a result of his company's recklessness."
However, it remains unclear how Obama can legally force BP to do so.
The oil in the Gulf of Mexico will linger as an "epidemic," Obama said
Additionally, the environmental and financial tolls of the catastrophe have yet to be fully assessed. Tourism and fishing industries along the Gulf of Mexico have suffered devastating effects, as oil washes ashore and vast areas of water are polluted, killing wildlife.
BP has limited press access to affected areas, limited the release of information and bought up spill-related online search terms at major search engines. It has also stopped referring to the catastrophe using the name of the "Deepwater Horizon" rig in favor of using the short-form name of the well it dug, "MC252."
BP Chief Executive Tony Hayward is expected to make an appearance before US lawmakers Thursday, and can expect a grilling. Oil company executives have said BP did not adhere to industry standards while drilling MC252.
Obama foresees policy changes
While BP has already agreed to some financial compensation, skeptics doubt the full costs of the spill will ever be recovered.
Currently BP is collecting about 15,000 barrels of oil a day. The company's latest plan follows pressure from the Obama administration and calls for more than 50,000 barrels a day to be collected by the end of June.
The well is expected to continue leaking until BP completes the first of two relief wells in August. The relief wells will take pressure off the leaking wellhead, allowing it to be capped.
Obama said the spill will shape future environment and energy policies
Obama has said the spill will have a 9/11-like effect on US environmental and energy policy for years to come. The consequences of US inaction are clear while China and other countries are making investments into clean energy jobs, he said.
"We cannot consign our children to this future. The tragedy unfolding on our coast is the most painful and powerful reminder yet that the time to embrace a clean energy future is now. Now is the moment for this generation to embark on a national mission to unleash American innovation and seize control of our own destiny," he added.
Fair compensation doubted
A number of non-governmental organizations fear that local populations and ecosystems will ultimately shoulder the catastrophe's most significant burdens, while BP minimizes losses for itself and its shareholders.
Greenpeace spokeswoman Cindy Baxter said she expects a scenario similar to the aftermath of the 1989 Exxon Valdez spill, during which 40,000 tons of crude oil leaked into Alaska's Prince William Sound. That resulted in a 19-year legal process over a five-billion-dollar (€4.06 billion) compensation deal.
"Exxon has taken it through the courts, and through the courts, and through the courts. The original five billion dollars? That estimated amount of compensation has now been reduced to $500 million," she told Deutsche Welle. "People who wanted compensation died looking for it. That includes workers who were working on the spill and have had huge amounts of health problems from working with the dispersants that they used."
Economic interests at risk
In addition to the damage caused by the current disaster, experts say prospecting for fossil fuels will likely become riskier in the future as energy demand rises and easily accessible resources dwindle. Advocates for renewable energy sources have been quick to point this out.
Felix Matthes, an expert on renewable energy at the Berlin Institute for Applied Ecology, says aggressive development of renewable energy infrastructure is a necessary investment which can be unified with economic interests.
Ecological damage has begun to devastate the tourism and fishing industries
"This catastrophe in the Gulf of Mexico has made it clear that the current use of energy – especially as accessing raw materials becomes ever more complicated, and this access means disturbing ever more delicate ecosystems – can come at a high cost," he told Deutsche Welle.
But the global economy is still based on oil, and the industry enjoys political protection. The United States' 1990 Oil Pollution Act, signed into law by President George Bush Sr., limits liability in the case of a spill to $75 million.
David Cadman of the organization Local Governments for Sustainability told Deutsche Welle he believes "there's going to be a great fight as to who should pay those bills. And I suspect BP is going to say: 'This is the agreement we had. We pay up to this and no more.'"
Author: Helle Jeppeson/gps/afp/rtrs/dpa
Editor: Ranjitha Balasubramanyam