The Long-Term Impact of Oil Spills on Ecosystem Recovery

This paper estimates the long-term ecological impacts of major oil spills on marine ecosystems by integrating remote sensing data with causal inference methods. Constructing a novel dataset of 14 oil spills worldwide between 2009 and 2011, I employ a synthetic difference-in-differences strategy to analyze satellite-derived measures of marine ecological function. The results reveal that large oil spills produce significant, worsening disruptions in the marine ecological health and food webs. For large oil spills, ten years after a spill event, I find a 26% decrease in phytoplankton carbon biomass, a 16% reduction in chlorophyll-a concentration, and a 20% decline in fish biomass support compared to counterfactual trajectories. Smaller spills, on the other hand, show insignificant impact. The economic damages can reach $1.84 billion for one spill. Smaller spills show no detectable long-term effects. Standard damage assessments thus substantially understate ecological and economic losses and highlight the severe need for a change in policy and assessment methods. I suggest a shift in the focus of disaster response policy towards addressing long-term damages to the ecosystem which involve monitoring and rehabilitating post-spill photosynthetic communities.