The BP Deepwater Horizon situation gets worse every day. I swear, this mess is going to turn me into a tree-hugger yet. This thing is really getting out of hand, and is going to have a massive impact on the oil business going forward.
Reinsurance companies have been devastated by the disaster already, and insurance premiums for energy-related offshore enterprises have shot up 50% in a month. The long term effect increased insurance costs will have on oil companies thanks to BP is going to mean big increases at the pump, and if history is any guide, the oil companies will be pre-emptive in their pricing strategies.
It also doesn't help that the company has a piss poor public image. Today, über-director and recognized ROV expert James Cameron referred to BP execs as "those morons" after the company declined his offer to help. And having your CEO publicly express his desire to go climb in a hole somewhere doesn't inspire much confidence in BP leadership.
Early on I was thinking the situation made BP an attractive takeover target. I no longer think that. The company is on the hook for what will certainly be tens of billions of dollars in damages (for which they self-insure - OOPS) and probably decades worth of class action lawsuits. I wouldn't touch BP with a ten foot pole right now. Fitch and Moody's just downgraded BP's rating and warned that further downgrades were possible.
Obviously, the people in the affected area are furious, and the commercial fishery down there is going to take years to recover. One company is selling anti-BP T-Shirts with a Louisiana license plate on the back that spells FUBPOIL. At least the Southern sense of humor is intact.
If this whole thing isn't a wake-up call to develop alternative energies, I don't know what it's going to take.
James Cameron is a fucking idiot. What the fuck could he possibly have to offer men who are operating these robots and machinery?
I'm so fed up with stupid fucking Hollywood thinking they know anything beyond paparazzi and showing how down to earth they are by telling Oprah about pranking each other on-set.
Next lets hear Francis Ford Coppola chime in and offer to help because he's got a fucking winery and has been plugging testing holes in oak casks... or perhaps he can offer his expertise in various types of cork he uses on his wine bottles.
Maybe Tom Cruise and explain to us how to conjure up a dormant alien deep in the seabed who will come turn off the oil spigot deep under the bedrock. Maybe we can hear fucking Brangelina's opine on the feasibility of plugging up the whole with Cambodian orphans.
Yeah, BP declined Cameron, however our Federal Gov't. invited him to join a group of problem-solvers.
http://www.google.com/hostednews/ap/article/ALeqM5jl64BJXcQfEi139LaAlsn…
He's considered "an expert on underwater filming and remote vehicle technologies," but I would like our Gov't. to be more clear on his role. I mean, if he's simply going to be filming their approach to the issue, that doesn't look so bad (even though BP is already filming this). A role beyong that scope, and you have to wonder about the many many many more qualified underwater engineers sitting dormant in the U.S.
BP is definitely in a world of hurt. $5/gal gas prices on the way?
BP is so screwed. BUT...
James Cameron will use this as inspiration for Avatar 2. Jennifer Lopez will be sad. Bradgelina will adopt a child 'affected' by the disaster.
and with this, the leak will be sealed and Hollywood will rejoice in saving mankind, once again.
Marcus,
I agree that Hollywood should stick to what it does best (or at least moderately well), but in Cameron's case he's legit. The guy has spent ungodly amounts of money on ROV technology, and he has a body of undersea work most people would be shocked to learn about.
He did a documentary a few years ago that almost no one knows about and it showcased some of the ROV technology he helped bring to the fore in undersea exploration.
Besides, even if he were just a typical Hollywood assclown, is BP really in a position pr-wise to turn down help from such a high-profile guy at this point? He's really as much a scientist as he is a movie director (or at least he knows how to manage the shit out of scientists).
Tree huggers need to get over it already
So guys, the obvious question is.....
How do we profit here? Shorting BP has already been discussed. Anyone see plays on oil, insurance, etc that should be easy money makers?
my .02 - it is a huge pet peeve of mine when people with no knowledge of situations decide to chime in on things (hollywood, senators, 17 year olds on this board) but I can't imagine that an hour with Cameron to pick his brain and see if he actually can help would've made the situation worse.
My guess is natural gas would get some hype. Obama has yet to fully endorse our (US) making the big switch, but I think there's a huge opportunity. We have tons of natural gas, and Boone's been setting himself up for this.
Buying companies like Westport (WPRT) that convert/manufacture engines for nat gas are probably a good play.
Exploration Co's like Devon Energy (DNV) and Linn Energy (LINE) will probably benefit. Time to do some research.
Or, play the commodity directly via the etf UNG.
I'm buying RIG
Nat gas has been a good trade so far!
Looks like PR department of BP is sucking each other off instead of trying to improve image of the company. Turning down Cameron's offer was a big, big mistake.
P.S.: on side note, I bet people @ GS are happy. Everyone forgot about them.
I think you are being unfairly harsh on Cameron. At the very least, Cameron would know experts from his work. So he might not be an engineer himself, but he would likely be well connected with people who are experts and could help provide solutions.
Cameron's a fuckin ass jockey. Because he's a filthy rich hobbiest he's some kind of asset to a project which likely has people who have lived their entire lives in deep sea, robotics, off short oil rigs, etc... I mean, seriously.
Its like a fuckin surgeon stepping up and saying "well I've hundreds of robotic surgeries, let me help you, you must need someone who knows how to work a robot". In fact, the surgeon would probably be a better offer than this choad scratcher.
Like someone else said these guys forgot more than Cameron ever fuckin knew.
Just because they're failing miserably doesn't mean every Tom, Dick and Harry capable of holding a press conference should be taken seriously.
On top of that, imagine how fucking ridiculous BP would look (well how much MORE ridiculous) if they started adding fucking movie directors and proctologists onto their team. The government is a pack of pimps and hoes, they'll setup a Task Force and Czars at the drop of a hat and stock it full of high profile names and catchy acronyms. Its all about selling.
I agree with Marcus here. Not to divert from the OP but, I absolutely hate when damn Hollywood celebs step out and speak about politics, world affairs, wars, or current events. They talk like they know their shit because they starred in a movie or sang a popular song. They are experts on nothing and speak like they are knowledgeable on everything.
Because they starred in a war movie they somehow inform our government of better strategies to fight our wars. haha
I too dislike it when celebs speak out about wars, natural disasters, etc. They know nothing about everything. The only good thing they do right is charity. Zip the lip and sway people's minds to donate.
James Cameron has nothing to do with this. BP were right to tell him to piss off.
And let's face it, accidents happen. Get over it.
It's not about who is right and who is wrong. It's about PR image. BP just fucked it up big time.
Explosion of Space Shuttle Columbia was an accident, disappearance of Air France Flight 447 over Atlantic was an accident. Deepwater Horizon spill was a direct result of poor judgement and recklessness.
I am not a tree-hugging hippie, but this incident is one of the worst natural disasters. I hope BP will go bankrupt because of lawsuits.
Fact #1: Qualified marine engineers are a handful. Cameron certainly knows people with legitimate experience that BP hasn't reached yet.
Fact #2: Accidents happen only if we take risks. If we stop offshore drilling, there will be no more accidents. The question here is, was it a risk worth taking? Maybe. But we certainly could choose a different risk/return mix. Like Edmundo, I believe this is a strong wake-up call for us to venture more seriously into alternative sources of energy. Call me a tree hugger all you like.
Too awesome not to share:
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