The Economic Effects of Oil Spills

deepwater-horizonOil spills cost the environment in many ways, not just by hurting the animals or the plants, but also economically it hits people’s pocketbooks. Many businesses, as well as individuals, lose money and face financial disaster for several years after these oil spills occur.

In fact, it could even be part of the reason why gas is so expensive right after one of these oil spill disasters happens. This is because not only of the shortage of oil, but the fear in the marketplace that these disasters generate..

What economic effects occur?
As is obvious, one of the main economic problems is that oil spills cause millions of gallons of oil to be lost. This means that it won’t be available to make more gasoline, so it causes the answer to the question, why is gas so expensive. Next, the cost of the oil spill cleanup methods causes the community where the oil spill happened to have to find a way to cover the price. Usually, this is borne by the oil company or the shipping company, but the community may still face some expenses.

Tourism Affected by Oil Spills
Coastal areas need tourism to earn money and oil spills causes a loss of tourists since the area is ruined by oil covering the ground and polluting the water. This means they lose income and therefore there is a big economic loss. This problem could go on for years as it takes a lot to clean up oil spills even though there are several kinds of oil cleanup methods.

Fishing Industry Affected by Oil Spills
Fishermen also face multiple economic issues because they lose money since the oil spills kill the fish and leave none to catch. This could be a long time issue as the area could sometimes never support the fish life again, thus making the economic loss a permanent one. In addition, their boats and other gear get ruined by the oil spill as well.

Other businesses suffer from oil spills
Other kinds of businesses such as hydroelectric power plants and desalination plants also suffer economic loss because they need clean sea water to run and if there is oil in the water it will contaminate and ruin their operations.

Oil Spills Kill Wildlife
Besides the loss of sea life, the oil spills often kill other animals like birds or sea mammals. This upsets the ecology in the area and the circle of life is disturbed, thus the economic loss is in the loss of the future possibility of the offspring of these animals living on to produce their own young and thus populate the area affected by an oil spill.

The bottom line is that when an oil spill occurs, it causes a huge loss of sea life, as well as the lives of other animals, plus it causes paycheck losses for tourism industry, as well as fishermen and some other businesses that rely on sea water to operate. Thus, there is a need to be careful to prevent oil spills from occurring and to improve on the oil cleanup methods.

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