Oil Firms, Tanker Owners Renew Debate Over Amount Each Should Pay in Oil Spill
Oil companies and tanker owners will take their longstanding feud over responsibility for oil spills to a diplomatic conference that starts today in London.</br></br>The goal of the month-long conference of the International Maritime Organization is to update treaties adopted in 1969 and 1971 that set limits on the liability of oil companies and shippers for oil-spill cleanup and damages costs.</br></br>Shipowners and oil companies had expected the accords to cover the cleanup costs of even the largest oil spills. But inflation, increased tanker sizes and bigger oil-spill damages have since forced the maritime organization to consider raising the maximum liability, which currently is $50 million for each oil spill.</br></br>Of that amount, shipowners are liable for up to $17 million in damages from oil spills. If cleanup costs exceed that, the oil companies, through a collective fund, are responsible for the rest, up to a maximum of $33 million.</br></br>Although both sides agree that the overall amount of liability should be increased, each wants the other to bear a greater share of oil-cleanup costs. Shippers complain that they end up paying for most oil spills. But the oil companies contend that with more oil spills exceeding the $17 million limit that shippers are responsible for, oil companies are taking on a greater share of the cleanup costs.