The impact of BP’s oil spill in the Gulf of Mexico is impossible to determine because it ultimately depends on how long it will take to contain the leaks. But one thing is certain: the costs will reach into the tens of billions of dollars at the very least. Can Americans expect the oil giant, which posted profits of $6.08 billion in the first quarter of 2010 alone, to pay for all the damage that the company’s disregard for safety and lack of disaster failsafes created?

According to BP CEO Tony Hayward, probably not. BP and the other oil corporations have a ludicrous federal law on their side that caps an oil company’s economic liability for an oil spill at $75 million. Although drilling a mile beneath the Gulf surface is an environmentally risky operation by nature, the oil industry successfully lobbied years ago for the rule, which effectively protects them from their own actions and oversights.

An additional $1 billion in cleanup costs and damages will be paid for by a special oil industry trust fund.

As with any other executive addressing a disaster, be it automotive, banking, pharmaceutical or oil, so much of what Hayward really means is concealed between the lines of what he actually says. When asked by CNN if BP would pay for the economic damages to workers and communities along the Gulf Coast, Hayward responded, “what I’ve said is what I mean; all legitimate claims will be honored.”

A year from now, we might hear Hayward asking Congress to define the word “legitimate.”

Senator Bill Nelson (D-Florida) met with Hayward and BP Chairman Lamar McKay in Washington to discuss the inevitable damages to his state’s economy. Nelson told CNN that the BP chief “expects the $75 million to be exceeded,” and when pressed about the liability for economic damages, he said “that will be something we will determine in the future.”

Nelson told CNN Hayward gave him the impression that BP would pay for damages above the $75-million cap, but that costs would be negotiated. After the meeting, Nelson introduced legislation to raise the liability cap to $10 billion.

Analysts warn that if BP doesn’t stop the leak in sooner than 3 months, the subsequent cleanup could take a decade and the sea could be damaged for a generation. In that case, damages to business and trade might be calculated in the hundreds of billions of dollars, likely pushing up taxes and deficit spending.

Related posts:

1. 21 years later Exxon still fights liability for the Valdez oil spill
2. BP tried to buy legal rights of Gulf fishermen for $5,000
3. Beasley Allen files class action case over BP oil spill in the Gulf of Mexico
4. Feds eye Halliburton as investigations of Gulf oil disaster move forward
5. Is the Gulf oil leak the result of deliberate negligence?