Archive for May 4th, 2010

The "spill" will be a problem for Obama … here’s why.

May 4, 2010

Lots of chatter on the right-leaning talk shows along two points:

(1) Obama was slow to respond to the crisis … no better than Bush on Katrina.

(2) There goes off-shore drilling as a source of oil for the U.S.

I can’t take the slow response criticism seriously.  I didn’t think Bush deserved it (should he have declared the LA Governor and N.O. Mayor to be grossly inept and Federalized the state ?)  … so I can’t criticize Obama on this one.

Interestingly, Obama got boxed by some bad timing.  Just a couple of weeks ago he announced expansion of off-shore drilling. While the announcement had no substance to it (actually cut back on authorized areas), it did provide some pro-drilling sound bites.  If he hadn’t said it, he would be in the catbird seat now: “See, I told you offshore drilling was bad.”  But, now he’s rhetorically in the offshore canoe.  We’ll see on that one.

My take: There will be a ‘discontinuity’ in offshore production.  This well is gone, and others will be shut or slowed by government inspections and reviews.

So what? 

I expect gas prices to be over $4 by the end of the summer … and maybe as high as $5 … due to curtailed supply and the oil companies costs of clean-up and mandatory rig upgrading.

The impact? Uh-oh for the economy. Oil is a major cost component of many products.  So, if oil prices spike, a broad range of prices to go up, demand will falter, and the expected recovery will sputter.

That means that unemployment stays high going into the November elections.

That’s a problem for the President.

Posted in Obama Administration, Oil & Energy | 3 Comments »

The power of branding … What does "BP" stand for ?

May 4, 2010

I’ve been a bit surprised that I haven’t heard or seen a single news report of the rig blast and oil spill that has referred to BP by its former name BRITISH PETROLEUM … or have made reference to the fact that its the UK’s largest corporation.

Now, I imagine that there have been some references that I’ve missed.  The bigger points are:

(1) Why the hush-hush ? … the omission strikes me as odd — certainly the reports would be different if the company were, say, formerly known as Bush Petroleum 

(2) Why haven’t we heard a peep from the British government ? … maybe because they’re in an election cycle

(3) Isn’t branding a powerful tool ? … imagine if the company was still called British Petroleum.

* * * * *

For the record … right from the people’s encyclopedia:

BP is the UK’s largest corporation.

BP plc (formerly The British Petroleum Company plc then BP Amoco plc) is a British global energy company that is the third largest global energy company and the 4th largest company in the world.

The company is among the largest private sector energy corporations in the world, and one of the six “supermajors” (vertically integrated private sector oil exploration, natural gas, and petroleum product marketing companies).

The company is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

British Petroleum merged with Amoco (formerly Standard Oil of Indiana) in December 1998, becoming BPAmoco until 2000 when it was renamed BP and adopted the tagline “Beyond Petroleum,” which remains in use today.

The company states that BP was never meant to be an abbreviation of its tagline.

Source: http://en.wikipedia.org/wiki/BP

Posted in Energy, Mktg - Brands | 1 Comment »