RISK ASSESSMENT OF

TRANSPORTATION OF
PETROCHEMICALS

Risk can be defined as ; ​The probability or threat of quantifiable damage, injury, liability, loss, or
any other negative occurrence that is caused by external or internal vulnerabilities.
Risk is present everywhere within our daily lives.
In the following question , the main purpose of this document is to highlight the risks present in
transport of materials from one location to another.
Both quantitative and qualitative ways of examining risk exits, however here we will be focussing
only on the qualitative ways of assessing risk.
The severity index of risk has been classified as follows -
8 - Activity involving high amounts of risk.
5 - Activity with somewhat high amount of risk.
3 - Activity with low to medium risk.
1 - Activity with almost no risk.
The probability of occurrence will be classified as -
High.
Medium.
Low.

The use of a risk matrix however , has been avoided.

During transport of chemicals from refinery to port , following are the risks involved based on
probability of occurrence-

1.Risk due to natural disasters or accidents-

Severity - 8
Probability -Low
During transport of dangerous chemicals , chances of explosion although low , can take
place.Not only is this harmful for the company as they would have lost a shipment,incurred huge
insurance losses, but would have a drastic effect on the environment as well.
Natural disasters in certain areas , like tsunamis , earthquakes also cause severe damage to
both company products and the environment.

2.Risk due to information systems malfunction-

Severity - 5
Probability - Low
Technology has changed the way in which logistics and transportation work. In the current era;
almost all operations , logistics , inventory management and scheduling is done via information
systems. Any risk in these systems has a huge effect on the companies logistics and can cause
harm if done on a very large scale. Small changes in schedules , or improper use of inventory
can lead to huge losses for the company.

3.Risk due to uncontrollable factors-

Severity-3
Probability - Medium
Uncontrollable factors involve those which are completely out of the company’s hand. Often
during public protests , workers union protests and public unrest , the transportation is affected.
This creates a huge bottleneck in the entire process, causing profits to take a dip , and
consumers to lose out on new products.
Other uncontrollable factors like hike in fuel prices , minor accidents during transportation etc.
also contain some risk.
Since parameters like fuel prices are uncontrollable and highly volatile , their severity is not
constant but rather dynamic in nature.

4.Risk due to human factor-

Severity-1
Probability - High
Human factor risk occurs daily in any aspect of life.During transportation, this risk comes in the
form of negligence of driver while transporting sensitive material, improper loading of chemicals
onto trucks, lack of time awareness etc. These factors contribute less toward overall risk ,
however they occur very frequently in such cases.