Share market reaction to the BP oil spill and the US government moratorium on exploration

The shares of BP plc and its subcontractors were rocked when the financial markets discovered the true impact of the Deepwater Horizon explosion as reported in the Wall Street Journal on 22 April 2010. While we track the impact of the disaster on share prices of the key participants, perhaps the most damaging response to the disaster was the introduction of the Gulf oil exploration moratorium on deep water drilling. We find that this adversely affected a range of firms in the oil and gas industry, extending the economic impact of the disaster well beyond BP plc and its subcontractors.