BP's ace in the hole is its contracts with the US Department of Defense, the largest oil consumer in the world. While the military is fighting two wars, one for oil wells (Iraq), the other for pipeline routes (Afghanistan and Pakistan), one of the Pentagon's most favored oil companies commits one of worst oil spill on record and it is still spilling, unabated. Because of BP's military contracts, the government may not impose serious sanctions on the company. It could become "a matter of national security" that BP not be punished. The wars were are fighting for oil are being fueled to a significant extent by BP from wells in the US and Gulf of Mexico.
The civilian government is helpless and is in fact continuing to permit new drilling in the Gulf. It can't stop the spill itself and has little control over BP's efforts. This situation is leading to cynical speculations about the government and BP, for example: pollution of the coastline is just a political obstacle to overcome on the way to full build out of drilling rigs in the Gulf. What is the entire population of the coast worth in comparison to the influence of a few oil companies?Read More »