Friday, July 09, 2010
It is not often you see industrial peers publicly separating themselves from another. That is, however, what the oil industry has done to BP. Oil companies are so afraid of the fall-out from the Gulf oil disaster that they are willing to blame everything on BP and trumpet their safety records. Sometimes it is necessary to do this, especially when there is a chance that regulation may change how the industry operates, as is happening now. But, it should not be an action taken easily because it invites closer inspection. The article, for example, notes that Exxon admitted publicly that it is not clear how to handle deep water drilling. When companies elect to stand apart rather than together, it is easier for regulatory authorities to set guidelines in a vacuum because there is no consensus about approaches to take. The industry has isolated BP, but the oil companies might find themselves standing alone soon enough.