Featured Research

from universities, journals, and other organizations

'Oil spill, flooding create perfect storm' for commerce, shipping, says supply chain professor

Date:
May 5, 2010
Source:
University of Rhode Island
Summary:
The oil spill in the Gulf of Mexico and epic flooding in Tennessee have created a "perfect storm" for businesses that rely on an efficient supply chain, according to one professor. In addition, the volcano in Iceland is causing unprecedented interruptions in the ability of businesses in Europe and the Baltic regions to ship goods via air transport.

The oil spill in the Gulf of Mexico and epic flooding in Tennessee have created a "perfect storm" for businesses that rely on an efficient supply chain, according to a University of Rhode Island professor.

In addition, the volcano in Iceland is causing unprecedented interruptions in the ability of businesses in Europe and the Baltic regions to ship goods via air transport, said Douglas Hales, associate professor of operations and supply chain management in URI's College of Business Administration.

In New Orleans and other Gulf Coast communities the impacts of the spill may only be beginning.

"Seventy percent of the coffee shipped to the United States goes through the Port of New Orleans," Hales said.

He would expect coffee prices to escalate if a solution is not found soon.

Large freighter ships can move through oil slicks, but Hales said protective booms must be moved and the ships themselves will drag oil with them. While the booms are moved, oil can move closer to the coastline.

"It's not easy to re-route these huge vessels," Hales said. "Traffic is still moving in and out of the Port of New Orleans because the heaviest slicks haven't reached there yet."

However, he added that smaller recreational boats and those used for commercial fishing and touring cannot operate in the slick because they will draw oil-contaminated water into their engines.

"The old paddleboats based in the Mississippi Delta will have to cease operations, too.

"It's going to be over for recreational and commercial fishing within the next few weeks if the spill is not stopped," Hales said. "Crude oil is like tar. The most efficient thing to do would be to burn the oil, since many of the dispersion agents in use are extremely toxic. It's either that, or let it spread to the beaches. Of course, a nasty cloud would be produced from the burning, which could also affect air quality and tourism throughout the Gulf."

Hales said it is important to remember that New Orleans is still down 200,000 to 250,000 residents in the wake of Hurricane Katrina. The impending oil catastrophe could lead to further flight as jobs are lost and people default on their businesses and homes.

Further north and east, Tennessee is reeling from heavy flooding. Hales said closures of Interstate 24, a major route for transportation of products from the south to northern Midwest states like Wisconsin and Michigan, have had a major impact.

"I would estimate that $3 to $5 million per day in freight operations have been lost because of closures on 24," Hales said. "Combined with severe cold weather in the south earlier this year, you have to expect prices to increase on products like orange juice coming out of Florida."

While the volcano in Iceland has grown more active in the last four days, Hales said most of the summer goods transported by air made it into the United States and Europe before the huge ash cloud interrupted passenger and freight flights. However, the airspace over Northern Ireland and the Republic of Ireland was closed Monday because of concerns that ash would drift into the area.

Hales said the airlines are estimating that the ash cloud caused $2 billion in passenger traffic interruption, but the interruption in airfreight traffic was probably two to three times that amount. Hales said there is a robust high tech industry in Ireland and Northern Europe that have to cope with another two to three days of shipping time. That's a huge amount of time when the high tech industry rolls out new products every three to six months.


Story Source:

The above story is based on materials provided by University of Rhode Island. Note: Materials may be edited for content and length.


Cite This Page:

University of Rhode Island. "'Oil spill, flooding create perfect storm' for commerce, shipping, says supply chain professor." ScienceDaily. ScienceDaily, 5 May 2010. <www.sciencedaily.com/releases/2010/05/100505133300.htm>.
University of Rhode Island. (2010, May 5). 'Oil spill, flooding create perfect storm' for commerce, shipping, says supply chain professor. ScienceDaily. Retrieved July 31, 2014 from www.sciencedaily.com/releases/2010/05/100505133300.htm
University of Rhode Island. "'Oil spill, flooding create perfect storm' for commerce, shipping, says supply chain professor." ScienceDaily. www.sciencedaily.com/releases/2010/05/100505133300.htm (accessed July 31, 2014).

Share This




More Earth & Climate News

Thursday, July 31, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Big Waves In Arctic Ocean Threaten Polar Ice

Big Waves In Arctic Ocean Threaten Polar Ice

Newsy (July 30, 2014) Big waves in parts of the Arctic Ocean are unprecedented, mainly because they used to be covered in ice. Video provided by Newsy
Powered by NewsLook.com
Raw: Thousands Flocking to German Crop Circle

Raw: Thousands Flocking to German Crop Circle

AP (July 30, 2014) Thousands of people are trekking to a Bavarian farmer's field to check out a mysterious set of crop circles. (July 30) Video provided by AP
Powered by NewsLook.com
Amid Drought, UCLA Sees Only Water

Amid Drought, UCLA Sees Only Water

AP (July 30, 2014) A ruptured 93-year-old water main left the UCLA campus awash in 8 million gallons of water in the middle of California's worst drought in decades. (July 30) Video provided by AP
Powered by NewsLook.com
In Virginia, the Rise of a New Space Coast

In Virginia, the Rise of a New Space Coast

AP (July 30, 2014) Every summer, tourists make the pilgrimage to Chincoteague Island, Va. to see wild ponies cross the Assateague Channel. But, it's the rockets sending to supplies to the International Space Station that are making this a year-round destination. (July 30) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

    Environment News

    Technology News



      Save/Print:
      Share:

      Free Subscriptions


      Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

      Get Social & Mobile


      Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

      Have Feedback?


      Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
      Mobile: iPhone Android Web
      Follow: Facebook Twitter Google+
      Subscribe: RSS Feeds Email Newsletters
      Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins