Iceland volcano costs US companies millions of dollars
The Iceland volcano has also disrupted tourism, trade in goods, and other economic activities for the US.
The volcanic debris, by disrupting air travel in the surrounding region, has also disrupted a range activities in the United States and other globally connected economies far from the ash cloud itself.
Among the sectors affected: the flow of visitors to tourist hot spots such as New York City, high-profile sporting events including a car race in Japan, and trade in goods including US- and Canadian-caught seafood.
The slowdown in global transport has even had an effect that many consumers may welcome: a modest dip in the price of oil.
How big the impacts are will depend on the behavior of the Eyjafjallajökull volcano itelf. The longer its ash-spewing eruption continues, the higher its cost to global economic activity.
Airlines, some of the businesses hardest hit, on Monday succeeded in persuading European regulators to partially lift a ban on flights affecting a large swath of the Continent. The industry, citing successful test flights over the weekend, argued that on many routes the ash poses no safety hazard.
The new arrangement, if it works as hoped, should begin to ease a logjam of stranded air travelers in the British Isles and elsewhere – including passengers waiting to return to Europe from US cities.
Yet, with air lanes not fully open, the activity of a single Icelandic volcano is serving as a reminder of how dependent the global economy is on transportation – even in an age of iPhones and digital networks. Some examples:
Tourism. Several million stranded travelers are struggling to get home, and many of these are Europeans in America, in addition to the hordes in London's Heathrow Airport. There's also the question of whether people with vacation plans later this month will be able – or willing – to fly.
The potential effect on one American city hints at the revenue at stake across the US and world. In a worst-case scenario, 160,000 visitors could cancel their trips to New York over a two-week period, costing the local economy as much as $250 million in revenue, according to NYC & Co., which promotes tourism to the city.