President Obama put the smack down on BP the other day, saying the company would put $20 billion in a fund that would go to those affected by the Gulf oil spill. BP won’t have to cough up all the money at once to prevent a panic among investors. But, investors got bad news as BP announced it would not pay any dividends for the rest of 2010. There was a payment scheduled for June 21 which was for about $2.6 million which has since been cancelled.
The oil continues to flow out of the broken rig. Scientists have estimated that the total so far may be around 116 million gallons. However, BP installed a second system to try to collect oil Wednesday. The new system can draw or burn about 10,000 barrels a day with the potential to collect more. Along with the first system installed, BP should be collecting about 25,000 barrels of oil a day.
The Gulf coast is still hard hit by this crisis. According to a report by the University of Southern Mississippi, restaurant and hotels bookings are down as much as 70 to 90 percent in Gulf towns. And, even though President Obama has told America it is safe to eat seafood from the Gulf Coast, seafood restaurants are still seeing a 30 percent drop in revenue.
Some think it is merely the fear of the oil rather than the actual oil causing the problem. David Butler, who wrote the report, said, “No oil has washed up on Mississippi beaches, yet the economic impact is very significant to the people of the Gulf Coast.” Some people blame the media reports of the disaster along with photographs of oil and affected wildlife for keeping people away from places in the Gulf that haven’t seen any oil yet.
The report says that the Mississippi counties Hancock, Harrison, and Jackson, all along the coast, stand to lose about $120 million in revenue over the next three months. Sean Snaith, an economist from the University of Central Florida, has estimated that Florida could lose 39,000 jobs and as much as $2.2 billion in revenue due to the decline in tourism to the state.