Oil Industry Reputation Hit by Gulf Oil Spill, Survey Shows
The Gulf oil spill has hit the reputation not only of BP but of the entire oil industry, including among those who favor increased use of fossil fuels as the main source of energy.
Research firm Market Strategies International said its E2 Index, which measures consumer perceptions of the energy industry's economic contribution and environmental performance and credibility, showed the image of the industry has declined 25% in the past six months, from 40 in December to 30 in June.
"While the oil spill was unique to BP, it has caused consumers to question whether a similar incident could happen to other companies," said Jack Lloyd, vice president of Market Strategies, which is based in the Detroit suburb of Livonia. "The entire industry will be under intense public scrutiny for the foreseeable future."
The spill resulting from the accident at BP's Deepwater Horizon will play a role in determining oil companies' business strategies and their marketing messages, he said.
The E2 Index, which is based on a 100-point scale, registered the oil industry at 29 when it was first established in the first quarter of 2008, but had climbed to 40 by last December.
Market Strategies segments respondents into five categories depending on their overall attitudes to energy and the environment. The "Carbon is King" segment, which is the only category to favor increased reliance on fossil fuels, registered a drop from 59 in December to 40 in June in its perception of the oil industry.
The "No Nukes" segment, which had the second-highest rating for the oil industry in December at 40, also showed a big percentage drop, registering 25 in June.
The other three segments also showed a decline. "Ultra Green" - respondents who strongly favor renewable energy and conservation -- declined from 16 to 13. "Anything Clean" - who support all clean energy options, including nuclear and clean coal - dropped from 32 to 28. "Atomic Efficiency" - who favor nuclear power as a clean energy solution - declined from 33 to 28.
"Much of the goodwill generated by the industry in the past two years has been wiped out by the Gulf oil spill," said Lloyd.
The overall E2 Index - which takes in all sectors of the energy industry - fell more than 10% in the period, from 48 to 43, Market Strategies said.
The index is based on a total of 1,010 interviews conducted online with consumers selected to reflect key characteristics of the U.S. population.
By Darrell Delamaide for Oilprice.com who offer detailed analysis on Oil, alternative Energy, Commodities, Finance and Geopolitics. They also provide free Geopolitical intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: http://www.oilprice.com