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 September 3, 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 September 3, 2014).

Share This



More Earth & Climate News

Wednesday, September 3, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Raw: Thousands of Fish Dead in Mexico Lake

Raw: Thousands of Fish Dead in Mexico Lake

AP (Sep. 2, 2014) — Over 53 tons of rotting fish have been removed from Lake Cajititlan in western Jalisco state. Authorities say that the thousands of fish did not die of natural causes. (Sep. 2) Video provided by AP
Powered by NewsLook.com
Raw: Iceland Volcano Spewing Smoke

Raw: Iceland Volcano Spewing Smoke

AP (Sep. 2, 2014) — The alert warning for the area surrounding Iceland's Bardarbunga volcano was kept at orange on Tuesday, indicating increased unrest with greater potential for an eruption. Smoke is spewing from the volcano, and lava is spouting nearby. (Sept. 2) Video provided by AP
Powered by NewsLook.com
U.N. Says Ebola Travel Restrictions Will Cause Food Shortage

U.N. Says Ebola Travel Restrictions Will Cause Food Shortage

Newsy (Sep. 2, 2014) — The U.N. says the problem is two-fold — quarantine zones and travel restrictions are limiting the movement of both people and food. Video provided by Newsy
Powered by NewsLook.com
Halliburton Reaches $1B Gulf Spill Settlement

Halliburton Reaches $1B Gulf Spill Settlement

AP (Sep. 2, 2014) — Halliburton's agreement to pay more than $1 billion to settle numerous claims involving the 2010 BP oil spill could be a way to diminish years of costly litigation. A federal judge still has to approve the settlement. (Sept. 2) 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