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Wednesday, May 5, 2010

Oil Spills in U.S. Coastal Waters: Background, Governance, and Issues for Congress

Jonathan L. Ramseur
Specialist in Environmental Policy

During the past two decades, while U.S. oil imports and consumption have steadily risen, oil spill incidents and the volume of oil spilled have not followed a similar course. In general, the annual number and volume of oil spills have shown declines—in some cases, dramatic declines. The 1989 Exxon Valdez spill in Alaskan waters played a large role in stimulating actions that contributed to this trend, particularly the decrease in the annual spill volumes. The Exxon Valdez spill highlighted the need for stronger legislation, inflamed public sentiment, and spurred Congress to enact comprehensive oil spill legislation, resulting in the Oil Pollution Act of 1990 (P.L. 101-380). This law expanded and clarified the authority of the federal government and created new oil spill prevention and preparedness requirements. Moreover, the 1990 legislation strengthened existing liability provisions, providing a greater deterrent against spills. After 1990, spill volume from oil tankers, the vessels that carry and have spilled the most oil, decreased significantly. 

Considering that U.S. oil consumption and oil imports have increased in recent decades, the trend of declining spill incidents and volume in past years is noteworthy. However, the risk of a major oil spill remains. Although recent Energy Information Administration (EIA) projections indicate that oil imports are expected to level off in coming years, the United States is expected to continue importing a substantial percentage of the oil it consumes. The threat of oil spills raises the question of whether U.S. officials have the necessary resources at hand to respond to a major spill. There is some concern that the favorable U.S. spill record has resulted in a loss of experienced personnel, capable of responding quickly and effectively to a major oil spill. 

Prior to actions by the 109th and 110th Congresses, the Oil Spill Liability Trust Fund was particularly vulnerable to a large and costly spill: Fund managers had projected the fund would be completely depleted by FY2009. Recent legislative developments have increased the oil spill liability limits and raised the tax rate that feeds into the trust fund. With these changes in effect, the most recent projection indicates that the fund will reach almost $1.5 billion by the end of FY2009 and crest $3.5 billion by FY2016. Although the trust fund is now less vulnerable to a major spill, some degree of exposure still remains, thus raising a central policy debate: How should policymakers allocate the costs associated with a major, accidental oil spill? For example, what share of costs should be borne by the responsible party (e.g., oil vessel owner/operators), the oil industry, and the general treasury? 

No oil spill is entirely benign. Even a relatively minor spill, depending on the timing and location, can cause significant harm to individual organisms and entire populations. Marine mammals, birds, bottom-dwelling and intertidal species, and organisms in early developmental stages—eggs or larvae—are especially vulnerable to a nearby spill. However, the effects of oil spills can vary greatly. Oil spills can cause impacts over a range of time scales, from only a few days to several years, or even decades in some cases. 

This report reviews the history and trends of oil spills in the United States; identifies the legal authorities governing oil spill prevention, response, and cleanup; and examines the threats of future oil spills in U.S. coastal waters. 

Date of Report: April 30, 2010
Number of Pages: 38
Order Number: RL33705
Price: $29.95

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