Authors: Michael Ferrari, PhD & Bill Kirk, CEO
Weather Trends International
As the BP Deepwater oil leak in the Gulf of Mexico has been dominating headlines over the last few weeks, this accident is now being labeled the largest offshore oil spill in U.S. history. Weather Trends has been fielding a variety of questions from various parties concerned with how the oil slick might impact the 2010 Tropical Atlantic hurricane season. We addressed this issue in an earlier post; essentially, Weather Trends is not changing our expectations for the season, which we issued in April, summarized here. But there are another set of questions that address the hurricane/oil nexus from a different angle – instead of speculating on how the oil release might positively or negatively affect the development of hurricanes, we can start to ask how a potential hurricane that moves into the Gulf of Mexico might affect the dispersion of the oil.
For some of the same reasons that we discussed in the prior post, it is difficult to say how a potential hurricane might affect the spill. As the leaking oil comes to the surface, it does not form a contiguous sheen; instead, it forms finger-like streams of oil that move with the currents, helped along by the prevailing winds. In addition, much will be determined in the coming weeks when we can better assess the success of both stopping the leak at the source, and the subsequent recovery of oil that has already released. If a hurricane were to develop and move into the Gulf, we should expect the obvious environmental effects on both aquatic and coastal ecosystems as the oil disrupts migration and feeding patterns. There are also implications to the commercial fishing/aquaculture and tourism industries along coastal towns from Florida to Texas; at this stage, these are unquantifiable, but we can be certain that the financial losses will be significant.
If we assume the worst-case scenario, this would place the majority of the oil in the eastern region of the Gulf, while a significant (Cat-3 or higher) hurricane is traveling northward towards Louisiana. Typical hurricanes carry most of their strength in the form of higher winds and moisture totals in the northeast quadrant (with the eye as the center). As the system circulates, the upper-right quadrant would have the most power in capturing oil at the surface and transporting it up to several hundred miles, depending on the track. Further, it is one thing to recover oil from surface waters, but it is another issue when the clean up turns to cleaning coastal marsh regions, significantly complicating the process, and exponentially increasing the remediation costs So we could easily envision scenes of oil-laden beaches up and down the coast – not a good plug for much needed tourism in the southern US. Take Florida for example – in 2009, the state welcomed 88 million visitors, who contributed $65 billion to the state’s economy. Given these figures, it is easy to calculate how even a small percentage of tourism dollars lost could have a significant financial impact to Florida’s tourism driven economy.
The 2010 Atlantic Hurricane season officially started on June 1st. Given the outlook by nearly all forecasting groups for a very active tropical season, Weather Trends International will be monitoring the Atlantic Basin very closely, and communicating any notable developments to both clients and the public, as they arise. So even though a hurricane transporting oil is an event with negative consequences, we can still make business decisions that will minimize the financial impact. As such, in addition to the weather forecasts which include our views on how a potential pattern may emerge and develop, we also frame our discussions in the context of the weather related impacts on society, whether they be related to commercial activity, health & well-being, property, consumer patterns or raw material prices. The tagline for Weather Trends International is ‘Better Business in Any Weather’. We encourage you to follow our discussions to learn more about how you can apply our insights to maximize your own business decisions, even in times of stormy weather.
