BP Oil Disaster Strains U.S. Relations With Britain, Creates Tension In Gulf

Fifty-eight days into the BP Deepwater disaster in the Gulf of Mexico, tensions are mounting between the U.S. and Britain, home to BP’s headquarters. 

Several British politicians have accused President Obama of fostering anti-British sentiment through his scathing attacks on BP’s negligence and poor response to the gusher in the Gulf. 

Britain’s prime minister David Cameron has also come under fire from the right wing for not standing up to U.S. efforts to make BP securely place funds in an escrow account to ensure adequate payments to those affected by the disaster.  That would likely mean the postponement or cancellation of BP’s upcoming dividend distribution, which many British pensioners rely on to make ends meet.

The Guardian reports:

“The oil washing up on the shores of America's deep south is proving toxic to more than the local wildlife. Both President Barack Obama and Britain's prime minister, David Cameron, are finding to their cost that a crisis for a globalised company like BP carries collateral damage. The urgent question for both men now is of who will be damaged more by the collision of politics and big business that is testing the UK's special relationship with the US to its limit.”

Across America, there is plenty of anger aimed at BP, with public boycotts slashing sales at BP stations as much as 25% in certain areas, and a chain of convenience stores in Pennsylvania changing its branding at three former BP stations.

The Guardian notes that President Obama has made “withering attacks on BP's management, an approach that has savaged the reputation of the company and its share price, which has fallen 39% since the rig exploded.”

While much of the public focuses its ire on BP, this disaster has also exposed many contradictions in the public’s reaction toward the federal government’s oversight of oil and gas industry activities.  A particularly thorny issue is the Obama administration’s decision to place a moratorium on deepwater offshore drilling while the investigation into the BP blowout continues.

While nobody appreciates the oil currently blackening the Gulf’s coastlines, some Gulf residents are as concerned about the loss of jobs if the offshore oil industry packs up shop in the Gulf and moves elsewhere.  With further damage being done to the region’s fishing and tourism economies, many fear a dearth of employment opportunities in the Gulf for years to come.

BP is certainly in a vulnerable position.  Some analysts believe BP’s total liabilities could total US$40 billion, perhaps enough to drive the multinational giant into bankruptcy.  That fragility has led BP executives to adopt a more humble stance than in prior weeks, pledging to "listen very carefully" to President Obama when they visit Washington today.

President Obama maintains his firm tone against BP, saying in his televised national speech about the Deepwater disaster:
“We will make BP pay for the damage their company has caused. And we will do whatever is necessary to help the Gulf Coast and its people recover from this tragedy.”

The President also noted in the speech the overwhelming reach of “oil industry lobbyists,” who have blocked repeated attempts to move toward energy independence by leveling the playing field for renewable forms of energy, which currently struggle to compete on par with heavily subsidized fossil fuel energy sources.

But President Obama also reminded the nation in his speech that the time to move beyond our dangerous addiction to oil and coal is now.

“Today, as we look to the gulf, we see an entire way of life being threatened by a menacing cloud of black crude,” the President 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.”

Will the public in both the U.S. and Britain embrace that call, even if it means some sacrifices in the near-term?  Many U.S. communities currently rely on fossil-based economies for jobs, so convincing them that they will not be left out of the transition to a cleaner economy will be a key challenge for the Obama administration.

Amidst all of this tension, one thing is clear – this disaster has forced a long-overdue conversation about the need to move beyond petroleum and coal to clean energy sources.  But that conversation will not be without its moments of conflict and contradiction, as we're witnessing now. 

Photo credit: Editor B's Flickr (Creative Commons).