Federal Law to Limit BP Liability in Oil Spill?

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The Obama administration may have a tough time making British Petroleum pay for all the cleanup costs of the Gulf Coast oil spill.

BP has agreed to pay those costs, but the law sets a liability cap for oil companies at $75 million. The cleanup costs and the losses for fisherman and other industries are expected to exceed that amount.

"We're glad that the costs for the oil clean up will be covered, but that's little consolation to the small businesses, fisheries and local governments that will be left to clean up the economic mess that somebody else caused," said Sen. Robert Menendez, D-N.J., a sponsor of the legislation raising the cap, which the administration said it supported.

Now some lawmakers have introduced a bill raising the limit to $10 billion.

Aside from the $75 million, the government also maintains an Oil Spill Liability Trust Fund supported by industry fees, which could make a total of $1 billion in payouts per incident to individuals, businesses and governments.

Meanwhile, Americans could soon see the impact of the spill on their wallets. Busy shipping lanes will likely be disrupted, leading to higher costs for items like coffee, bananas, and even tires.

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