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What are the economic significances of discovery of oil in Arctic Sea and its possible environmental consequences?

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The Arctic may contain 12% of the world’s undiscovered oil reserves and 30% of the natural gas reserves that have not yet been discovered, according to the USGS (United States Geological Survey). Environmentalists have voiced their opposition to the exploration. The world’s largest untapped gas reserves and some of its largest undiscovered oil deposits are thought to be located in the Arctic. If these reserves are used, the effects on everything from the economy to the arctic environment and global climate change could be seen.

The importance of oil’s discovery economically:

  • As a result of more economical energy, there will be an abundance of cheap goods, which will increase the potential for global expansion.
  • decreased reliance on Gulf nations and the Middle East, changing the geopolitical and economic dynamics of the world’s population.
  • increased job and investment creation due to the drilling of new oil wells and the construction of essential backward and forward links.
  • Exploring these resources will meet the expanding demands of the global economy and could bring down oil prices.

Environmental consequences:

  • There is a threat to economically and culturally significant species. There have been reports of widespread walrus migration.
  • In this area, permafrost serves as a carbon sink. They contain powerful greenhouse gases that, if released through drilling, have the potential to hasten global warming.
  • The region’s delicate flora and animals may suffer if the ecosystem is disrupted.
  • Whale species that require sound for navigating and hunting will be harmed by excessive ocean noise during the extraction process.

A resurgence of the cold war due to international rivalry in the Arctic is another worry. While participating in the Arctic rush, nations would do well to keep in mind the fundamental ecological principle that nature cannot be changed and that everything is interconnected.

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