It’s time to stop blaming BP – alone. At least four other oil companies hired the same firm to write their plans for handling spills in the Gulf of Mexico. They ended up with nearly identical plans, complete with thoughtful concern about impacts on walruses. The CEO of ExxonMobil called it “unfortunate” and “embarrassing” that the plan included walruses, which have not been present in the Gulf region for millions of years.

On the other hand, according to U.S. Rep. Ed Markey, the oil industry’s standard plan for Gulf spills never mentions hurricanes or tropical storms, which do appear in the region on an annual basis. This makes perfect sense under only one interpretation: the oil companies were certain that accidents never happen. If there are no oil spills, your spill response plan can talk about unicorns, and no one will be the wiser.

We are, unfortunately, wiser now. We are leaving the era of low-risk, conventional energy supplies; for the future, everything depends on how we manage the risks of finding and producing fuel. Last year, 30 percent of U.S. oil production came from offshore wells, almost entirely in the Gulf of Mexico. Since U.S. onshore production is rapidly falling, our dependence on offshore drilling is bound to increase.

Drilling safely and responsibly is sure to raise the cost of producing oil. Hopefully the industry will learn the most obvious lesson from the Deepwater Horizon disaster, and install better blowout protectors on drilling rigs. Although this looks expensive, it is quite the bargain when compared to the alternative of cleaning up a major spill. But the next draft of the spill response plan really has to talk about hurricanes.

The 2005 hurricane season, which devastated New Orleans and other coastal areas, was even more intensely violent over the open water. The top three storms of 2005, Katrina, Rita, and Wilma, were all Category 5 hurricanes in the Gulf of Mexico. One thing that the troubled Minerals Management Service (MMS) did right was to commission a detailed oceanographic study of that year’s hurricanes, in order to understand their effects on offshore drilling.

Katrina vs. offshore oil

Katrina reached its maximum intensity in an area just south of Louisiana, full of oil wells and coincidentally close to the site of the Deepwater Horizon accident. It had sustained wind speeds of 175 mph, and may have created 80-foot waves. Katrina destroyed 50 offshore oil platforms and drilling rigs, and did serious damage to Shell’s Mars platform, the top producer in the Gulf. Mars is a 36,500-ton structure, which cost $1 billion to build. The storm knocked a 1,000-ton drilling rig off the top of the Mars platform, into the center of the structure. The repairs to Mars required eight months and 600,000 person-hours of labor.

According to MMS statistics, total U.S. offshore oil production was one-third lower in the eight months after Katrina than in the eight months before. If nature is going to wipe out one-third of the industry from time to time, drilling in the Gulf of Mexico doesn’t sound like much of a plan for energy security.

Or maybe the 2005 hurricane season was an outlier, a once-in-a-century event that we don’t have to worry about in normal life? Between disasters, it’s always more appealing to ignore risks and avoid the costs of being prepared; that’s why New Orleans had such shoddy levees in 2005. This option doesn’t really hold water, though: Climate change is making hurricanes, on average, more intense.

By one reckoning, a hurricane season as destructive as 2005 would have occurred once in 110 years without climate change, but will happen once every 40 years with climate change. And that doesn’t mean 39 trouble-free years for every Katrina! Moderately dreadful hurricanes, perhaps bad enough to knock out only one-sixth of the industry for a few months, will happen more often than once every 40 years. We’re already being warned that BP’s ill-starred attempt to control the Deepwater Horizon blowout could be blown away by this year’s tropical storms.

So we’re overusing fossil fuels, causing climate change – which intensifies hurricanes and makes our fuel supply less secure. We could try building bigger and bigger platforms, to withstand stronger and stronger winds and waves. Or we could look for an alternative source of energy.

Wait a minute, we’ll think of something. I hope.

The Deepwater Horizon disaster has the familiar ingredients of deregulation, deception, and destruction that characterize the relations between governments and multinational corporations. It was a man-made disaster, like Chernobyl. And like the global financial crisis, it all started with the explosion of a bubble, this time of methane gas.

The Wages of Deregulation

In 2008 the Bush-Cheney duo lifted the executive order banning offshore drilling, and the House of Representatives agreed to let a 26-year-old moratorium on offshore drilling expire. Deregulation was moving full speed ahead.

Monitoring agencies were unable to keep pace with British Petroleum’s (BP) operations. Marine biologist Rick Steiner, an expert on oil spills from the University of Alaska, has documented how BP cut corners in its hurry to disconnect and prepare for a production rig. In addition Steiner reveals the blowout preventer (BOP) was not built as designed, included some demonstration parts, and had a failed battery.

Offshore drilling operations in Norway and Brazil use acoustic triggers and remote control cut-off devices to enhance the capacity of BOPs to work adequately. But a report commissioned by the Minerals Management Service (MMS) stated “acoustic systems are not recommended because they tend to be very costly.” Was former vice president and oil man Dick Cheney behind the Department of Interior’s decision not to mandate the valve for off-shore oil rigs? Nor did the U.S. government mandate the simultaneous drilling of relief wells, as required in Canada’s Arctic. Only now, with the failure of the “top kill” technique, is BP drilling these wells, and they won’t be functional before August.

The MMS also routinely overruled its staff of biologists and engineers, who had raised concerns about the safety and environmental impact of certain drilling proposals in the Gulf and in Alaska. The U.S. government permitted BP and other oil companies to drill with cutting-edge technologies without the usual permits.

Were the government regulators doing their job of regulating, or were they in bed with the industry?

Parallels to Financial Crisis

British Petroleum bragged about being at the frontier of technology. Goldman Sachs and the other behemoths of the financial world also claimed to be at the cutting edge of financial innovation. They all lied, hid information, and speculated behind a facade of corporate professionalism built through their advertising campaigns.

Just like the derivatives that took junk assets into every balance sheet of financial institutions, the Deepwater Horizon disaster has no frontiers. The gushing oil will eventually threaten not only Cuba and Mexico, but it will end up reaching the Gulf Stream. It might even make it to England and several world financial centers.

Many are the scams concocted in the financial world, from structured investment vehicles carrying subprime mortgages to credit default swaps and short-selling. They call it business on Wall Street, but it’s really weapons of mass financial destruction. British Petroleum also has a long list of accidents and incidents, all leading to the loss of life and oil spills (including the explosion in its refinery in Texas City in 2005 that cost 15 lives). There will probably be no bailout for BP, but there already exists a liability cap of $75 million.

That cap is invalid in cases where criminal negligence exists. The U.S. Attorney General has already launched a criminal investigation. Already there is circumstantial evidence that BP’s technicians altered the sequence of events and ordered the removal of drilling mud before the cement cap was put in place in order to gain time. This was done in spite of the fact that BP was already working with a damaged blow-out preventer. If this is confirmed, BP will have a hard time convincing authorities that this was just an accident.

Who’s in Charge?

BP has used more than 800,000 gallons of oil dispersant Corexit on the surface and underwater. Corexit is manufactured by Nalco, whose board includes at least one BP executive. Because Corexit is less efficient and more toxic than other dispersants, the Environmental Protection Agency requested that BP use another dispersant. BP quickly overruled this request, showing who’s in charge.

As he came into the White House, Obama became a hostage of the financial system and essentially gave Wall Street a free hand in solving “its” problems. For weeks after the rig exploded, BP appeared to be the main entity in charge of the response to the oil spill.

Obama’s lack of firm leadership has prompted comparisons with Katrina. But in fact, the similarities with Chernobyl are stronger. Katrina was a natural disaster, while the Deepwater Horizon is a man-made catastrophe related to greed and cost minimization.

Just as the global financial and economic crisis is entering its most dangerous phase, the oil spill is now developing into a catastrophe that will affect ecosystems and livelihoods for decades. It is more like Chernobyl than anything else.

When Unit 4 in Chernobyl exploded on April 26, 1986, it not only caused the worst disaster in the history of nuclear technology. It also shattered the technological prestige of the Soviet Union, boosted concerns about the nuclear safety of the remaining plants and forced Soviet authorities to be less cryptic. Ultimately, Chernobyl ushered in the demise of the Soviet Union. Perhaps the destruction of the Deepwater Horizon will open the way for a new era of accountability and the end of corporate capitalism in the United States.

This commentary was also published by Foreign Policy in Focus.

Triple Crisis blogger Lyuba Zarsky was interviewed on Press TV May 14 on the BP oil spill in the Gulf of Mexico.

“An upside-down faucet, just open and running out.” That’s how an oil-spill expert at the Woods Hole Oceanographic Institute describes the massive release of crude oil into the Gulf of Mexico that began April 20^th at British Petroleum’s Deep Horizon oil rig off the coast of Louisiana. [See live video feed of the spill here.]

The disaster has opened an information faucet, too: every day, more truth about the real costs of fossil fuels is emptying into public view. Desperate efforts to control both spills are underway.

After its 450-ton blowout preventer failed, BP tried burning the oil slick, creating the macabre spectacle of the ocean on fire.

The company then tried using chemical dispersants to reduce the oil reaching the surface, a strategy that helped to create enormous underwater oil plumes – as much as 10 miles long, 3 miles wide and 300 feet thick – now floating toward the powerful loop current that could “slingshot the oil into the Atlantic Ocean around the Florida Keys” and threaten the eastern seaboard. The dispersants themselves are toxic, but their impacts on marine ecosystems are poorly understood because the chemical recipe is a proprietary secret.

In exploration plans filed with the government’s ethically-challenged Minerals Management Service in February 2009, BP claimed it was “unlikely that an accidental surface or subsurface oil spill would occur from the proposed activities,” and that if this happened, “due to the distance to shore (48 miles) and the response capabilities that would be implemented, no significant adverse impacts are expected.” So far, oil has washed onto 65 miles of Louisiana’s shoreline, penetrating more than 10 miles into the coastal marshes that account for 40% of the wetlands in the continental United States. Fishing has been banned in 19% of Gulf waters under U.S. jurisdiction – a devastating blow to local livelihoods.

Containing the truth spill is proving as difficult as plugging the gusher. In the wake of the spill, BP CEO Tony Hayward launched a public relations campaign to “win the hearts and minds” of the people. A predictable apologist on Fox News claimed that natural seepage puts more oil into the ocean than accidents, and Rush Limbaugh asserted that oil is “as natural as the ocean water.” The New York Times reminded its readers that “America needs the oil.” All bring to mind what the late John Kenneth Galbraith once called “the effort to make pollution seem palatable or worth the cost.”

But the truth is swamping these efforts. Each day brings new revelations about the magnitude of the disaster. Even Fox News reports that it “could be much worse than we knew.” Experts estimate the rupture at 40,000-100,000 barrels per day, far above BP’s claim of 5,000 barrels. “It is clear BP has been lying,” concludes Congressman Ed Markey, chairman of the House Subcommittee on Energy and the Environment.

The bad news about fossil fuels is not limited to the Gulf. “All oil comes from someone’s backyard,” observes Lisa Margonelli in The New York Times, noting that “Nigeria has suffered spills equivalent to that of the Exxon Valdez every year since 1969.” Recent mine disasters in West Virginia, Russia and China underscore the real costs of coal. Mining of Canadian tar sands, now the most important source of U.S. oil imports, is chopping into the world’s largest boreal forest and creating sludge ponds “so toxic that the companies try to frighten birds away with scarecrows and propane cannons.”

In the best-case scenario – with no accidents and minimal environmental damage from extraction – burning fossil fuels “only” emits greenhouse gases that threaten future generations, together with co-pollutants that lead to roughly 20,000 premature deaths annually in the United States, according to a 2009 National Academy of Sciences study.

As the real costs of fossil fuels become more apparent, support grows for the clean energy transition. “The disaster in the Gulf only underscores that even as we pursue domestic production to reduce our reliance on imported oil,” President Obama said last Friday, “our long-term security depends on the development of alternative sources of fuel and new transportation technologies.”  If the Gulf disaster accelerates this transition, it will not have been entirely in vain.