Matthew Simmons has made a lot of big claims about the oil spill (see videos below).
Because of his background, Simmons has been interviewed repeatedly in television, newspaper and radio media. Simmons was an energy adviser to President George W. Bush, is an adviser to the Oil Depletion Analysis Centre, and is a member of the National Petroleum Council and the Council on Foreign Relations, and is former chairman and CEO of Simmons & Company International, an investment bank catering to oil companies.
People have become polarized around Simmons as a lightning rod. For example, people who believe all of Simmons’ claims believe that anyone who questions any of Simmons’s claims is working for BP. On the other extreme, people who think Simmons has gone senile or is simply talking his book (he’s short BP) tar and feather anyone who questions BP’s version of the Gulf narrative as being a crazy Simmons follower.
So let’s assess Simmons’ claims one-by-one. And – more importantly – let’s refocus the discussion away from one person and towards the Gulf itself (Simmons himself will either be vindicated, proven off-base, or something in between. But that is his personal concern, not ours).
BP’s stock Will Go to Zero
Simmons predicts that BP’s stock will go to zero. he might be right. Fines under the Clean Water Act are $4,300 per barrel of oil spilled into the Gulf of Mexico. And civil and criminal damages could be substantial.
But BP has been doing everything in its power to lowball the amount of oil spilled into the Gulf (and see this), even though it easily could have easily quantified how much oil is spilling. If the government allows BP to get away with lowballing the spill number, the fines won’t bankrupt BP.
Similarly, if the government let’s BP maintain its $75 million liability cap on economic damages, let’s BP hide the extent of the damage to the Gulf (see this and this), to perform only a superficial clean up of the Gulf and fails to press criminal charges (or let’s BP off with a slap on the wrist), then BP might survive by selling assets.
And remember, BP is still one of the largest suppliers of oil to the U.S. military. See this and this.
In addition, Gordon T. Long argues that the failure of BP would have a greater affect on the U.S. economy than the failure of Lehman.
So some say that – even if it’s wrong – BP will be considered “too big to fail” and will be bailed out.
There is a “Lake of Oil” in the Gulf
Simmons claims there is a “lake of oil” in the Gulf, 30 feet thick and miles long.
I don’t know about this claim, but scientists have found giant underwater plumes, and NOAA has just announced traces of oil 30 meters thick stretching for quite a ways. See this, this, this and this. Specifically, because millions of gallons of Corexit have been applied, many solid plumes have been broken up into giant bodies of solution … mixtures of water, oil, methane and dispersant.
But these solutions can contain levels of oil and other chemicals which are at or near the levels which are toxic to marine life (see below).
Related posts:
- BP says lightning strike and fire on ship halts containment of oil leaking from Gulf
- Oil Industry Insider and CFR Member Predicts Gulf Evacuation
- Is CFR member Matt Simmons spreading fear about the oil spill and encouraging conspiracies theories surrounding the Gulf oil spill?
- Matt Simmons apparently drowned at his home Sunday night
- Did The CIA Assassinate Matt Simmons For Blowing The Whistle On The BP Gulf Oil Spill Coverup?
- Anonymous plans UFO hoax as Gene Simmons softens his stance on hackers
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