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| BP shares dive as crisis persists | BP shares dive as crisis persists |
| (40 minutes later) | |
| BP Last updated: 10 Jun 2010, 16:23 UK *Chart shows local time More data on this share price | |
| BP shares have continued to trade lower as attention turns to the possible impact of the Gulf of Mexico oil spill on the UK's image in the US. | BP shares have continued to trade lower as attention turns to the possible impact of the Gulf of Mexico oil spill on the UK's image in the US. |
| The oil giant's shares were 6% lower by lunchtime after earlier plunging 12%. | The oil giant's shares were 6% lower by lunchtime after earlier plunging 12%. |
| The UK government has played down fears expressed by some senior figures of "anti-British rhetoric" in the US. | The UK government has played down fears expressed by some senior figures of "anti-British rhetoric" in the US. |
| Prime Minister David Cameron, who will discuss BP with President Obama this week, said he understood the US government's "frustration". | Prime Minister David Cameron, who will discuss BP with President Obama this week, said he understood the US government's "frustration". |
| Mr Cameron also said that the UK stands ready to help BP with the clean-up operation. | Mr Cameron also said that the UK stands ready to help BP with the clean-up operation. |
| A government spokesperson told the BBC that the Prime Minister was referring to 600 tons of chemical dispersant that have been made available by the Department of Energy and Climate Change. | A government spokesperson told the BBC that the Prime Minister was referring to 600 tons of chemical dispersant that have been made available by the Department of Energy and Climate Change. |
| Price falls | Price falls |
| BP's shares, which are jointly listed on the New York stock exchange, plunged nearly 16% in US trading hours after London closed on Wednesday, on fears that President Obama would impose huge penalties on the company. | BP's shares, which are jointly listed on the New York stock exchange, plunged nearly 16% in US trading hours after London closed on Wednesday, on fears that President Obama would impose huge penalties on the company. |
| As a result, BP's UK share price opened at 345 pence on Thursday in London, down nearly 12% on yesterday's London close, and its lowest level since 1997. | As a result, BP's UK share price opened at 345 pence on Thursday in London, down nearly 12% on yesterday's London close, and its lowest level since 1997. |
| The price has since recovered during London trading hours, and was trading at 365p in mid-afternoon trading. | The price has since recovered during London trading hours, and was trading at 365p in mid-afternoon trading. |
| The recovery during London hours has also been reflected in New York, where BP's US shares opened up 9% versus the previous US close. | The recovery during London hours has also been reflected in New York, where BP's US shares opened up 9% versus the previous US close. |
| However, the recent price moves mean the oil giant's share price has almost halved since the Deepwater Horizon oil spill began on 20 April. | However, the recent price moves mean the oil giant's share price has almost halved since the Deepwater Horizon oil spill began on 20 April. |
| 'Very heavy price' | 'Very heavy price' |
| The company has come under increasingly sharp attack by some US politicians for its handling of the spill, described as the worst environmental disaster the US has faced. | The company has come under increasingly sharp attack by some US politicians for its handling of the spill, described as the worst environmental disaster the US has faced. |
| Overnight, the US Justice Department said it was examining ways of forcing BP to suspend its dividend until BP's full liability for the oil spill is known with more precision. | Overnight, the US Justice Department said it was examining ways of forcing BP to suspend its dividend until BP's full liability for the oil spill is known with more precision. |
| And the Justice Department is only doing what influential US politicians are demanding. Which is a serious concern to BP, in that it may be a British company by dint of history and legal domicile, but it is very American by virtue of its giant acquisitions of a decade or so ago. | And the Justice Department is only doing what influential US politicians are demanding. Which is a serious concern to BP, in that it may be a British company by dint of history and legal domicile, but it is very American by virtue of its giant acquisitions of a decade or so ago. |
| My conversations with those at the top of BP indicate that they're increasingly minded to go for a voluntary moratorium on dividend payments, to bring some kind of fragile truce to hostilities with the US government. | My conversations with those at the top of BP indicate that they're increasingly minded to go for a voluntary moratorium on dividend payments, to bring some kind of fragile truce to hostilities with the US government. |
| But President Obama should be aware that such a suspension of dividends would in effect deprive US savers of some $4bn of income per annum. Or to put it another way, in a world of global capitalism, Obama can't punish BP and expect all or even most of the pain to be felt in Britain. | But President Obama should be aware that such a suspension of dividends would in effect deprive US savers of some $4bn of income per annum. Or to put it another way, in a world of global capitalism, Obama can't punish BP and expect all or even most of the pain to be felt in Britain. |
| Read Robert's blog in full Send us your comments | |
| London mayor Boris Johnson told the BBC that BP had paid a "very, very heavy price", and expressed concern that the oil spill was beginning to damage the entire image of the UK in the US. | London mayor Boris Johnson told the BBC that BP had paid a "very, very heavy price", and expressed concern that the oil spill was beginning to damage the entire image of the UK in the US. |
| "I do think there's something slightly worrying about the anti-British rhetoric that seems to be permeating from America," he told BBC Radio 4's Today programme. | "I do think there's something slightly worrying about the anti-British rhetoric that seems to be permeating from America," he told BBC Radio 4's Today programme. |
| However, British foreign secretary William Hague has downplayed the extent of anti-British feelings across the Atlantic. | However, British foreign secretary William Hague has downplayed the extent of anti-British feelings across the Atlantic. |
| "No-one has used an anti-British tone in anything that I've detected," he told the BBC. | "No-one has used an anti-British tone in anything that I've detected," he told the BBC. |
| Speaking during a visit to Afghanistan, UK Prime Minister David Cameron, confirmed he would discuss the oil spill with President Obama during their regular phone call. | Speaking during a visit to Afghanistan, UK Prime Minister David Cameron, confirmed he would discuss the oil spill with President Obama during their regular phone call. |
| "I completely understand the US government's frustration," he said. | "I completely understand the US government's frustration," he said. |
| "BP needs to do everything it can to deal with the situation and the UK government stands ready to help." | "BP needs to do everything it can to deal with the situation and the UK government stands ready to help." |
| The former British ambassador to the US, Sir Christopher Meyer, told the BBC that the BP issue had become "a bit of a crisis, politically". | The former British ambassador to the US, Sir Christopher Meyer, told the BBC that the BP issue had become "a bit of a crisis, politically". |
| "The government must put down a marker with the US administration that the survival and long term prosperity of BP is a vital British interest," he said. | "The government must put down a marker with the US administration that the survival and long term prosperity of BP is a vital British interest," he said. |
| He added that with nearly 40% of BP shares held in the US the company was "a pretty vital American interest too, fully integrated into US energy infrastructure". | He added that with nearly 40% of BP shares held in the US the company was "a pretty vital American interest too, fully integrated into US energy infrastructure". |
| Dividend fears | Dividend fears |
| US interior secretary Ken Salazar said that BP should compensate other oil companies that have had to lay off workers because of a moratorium on deep sea drilling announced by President Obama in response to the Gulf of Mexico spill. | US interior secretary Ken Salazar said that BP should compensate other oil companies that have had to lay off workers because of a moratorium on deep sea drilling announced by President Obama in response to the Gulf of Mexico spill. |
| Meanwhile, associate attorney general Thomas Perelli told a congressional hearing on Wednesday that the Justice Department was planning to take action to force BP to withhold its next dividend payment. | Meanwhile, associate attorney general Thomas Perelli told a congressional hearing on Wednesday that the Justice Department was planning to take action to force BP to withhold its next dividend payment. |
| The drop in BP's share price is already bad news for UK pension funds, which invest heavily in the firm. | The drop in BP's share price is already bad news for UK pension funds, which invest heavily in the firm. |
| The oil company has said that it pays £1 in every £7 of dividends that pension funds receive from FTSE 100 companies. | The oil company has said that it pays £1 in every £7 of dividends that pension funds receive from FTSE 100 companies. |
| Further congressional hearings into the Gulf of Mexico oil leak are planned on Thursday. | Further congressional hearings into the Gulf of Mexico oil leak are planned on Thursday. |
| US perceptions | US perceptions |
| The US President has said he is looking for "ass to kick" at BP, and that he would have sacked BP chief executive Tony Hayward over flippant comments about the scale of the spill. | The US President has said he is looking for "ass to kick" at BP, and that he would have sacked BP chief executive Tony Hayward over flippant comments about the scale of the spill. |
| John Hofmeister, former head of Shell in the US, told the Today programme he thought the situation was compounded by American perceptions that a foreign company had "insulted the American landscape". | John Hofmeister, former head of Shell in the US, told the Today programme he thought the situation was compounded by American perceptions that a foreign company had "insulted the American landscape". |
| "I think in retrospect it was a mistake for Tony Hayward himself to have been so fully present in the United States... with the accent that he naturally has... this was an apparent foreign company." | "I think in retrospect it was a mistake for Tony Hayward himself to have been so fully present in the United States... with the accent that he naturally has... this was an apparent foreign company." |
| BP is jointly listed on the New York Stock Exchange - and trading in its US shares closed nearly 16% down on Wednesday night. | BP is jointly listed on the New York Stock Exchange - and trading in its US shares closed nearly 16% down on Wednesday night. |
| BP said it was not aware of any reason why its US shares had fallen so sharply | BP said it was not aware of any reason why its US shares had fallen so sharply |
| In response to the sharp fall in the US, BP said it was "not aware of any reason which justifies this share price movement". | In response to the sharp fall in the US, BP said it was "not aware of any reason which justifies this share price movement". |
| In its latest update on the spill, the oil giant sought to reassure investors that it was on a strong financial footing with a stronger-than-forecast cash flow. | In its latest update on the spill, the oil giant sought to reassure investors that it was on a strong financial footing with a stronger-than-forecast cash flow. |
| It also said that the total actual cost to date was some $1.43bn (£1bn). This compares with a total of £55bn that has been wiped off BP's value since the spill began. | It also said that the total actual cost to date was some $1.43bn (£1bn). This compares with a total of £55bn that has been wiped off BP's value since the spill began. |
| Thursday's opening losses follow a 4.5% slide in BP shares in the UK on Wednesday over fears of a dividend cut. Its next dividend is due to be declared on 27 July. | Thursday's opening losses follow a 4.5% slide in BP shares in the UK on Wednesday over fears of a dividend cut. Its next dividend is due to be declared on 27 July. |
| Market nerves have also been reflected in the value of BP's bonds, which now trade at levels comparable with junk-rated companies. | Market nerves have also been reflected in the value of BP's bonds, which now trade at levels comparable with junk-rated companies. |
| This is despite the company continuing to enjoy high "investment grade" ratings from all three major ratings agencies. | This is despite the company continuing to enjoy high "investment grade" ratings from all three major ratings agencies. |
| Takeover target? | Takeover target? |
| Speculation is growing that BP's depressed share price may make it a target for a possible takeover. | Speculation is growing that BP's depressed share price may make it a target for a possible takeover. |
| "I can understand exactly as to why somebody else would want to buy the BP assets because I think they are grossly undervalued at the moment," said Robert Talbut, of Royal London Asset Management, a BP shareholder. | "I can understand exactly as to why somebody else would want to buy the BP assets because I think they are grossly undervalued at the moment," said Robert Talbut, of Royal London Asset Management, a BP shareholder. |
| In a recent research note, Standard Chartered suggested that PetroChina - a subsidiary of China's state-owned national oil company - should make a bid for BP in order to gain a global presence. | In a recent research note, Standard Chartered suggested that PetroChina - a subsidiary of China's state-owned national oil company - should make a bid for BP in order to gain a global presence. |
| "As a shareholder, it's not something that I would welcome and it's certainly not at this sort of share price I would be willing to sell at," Mr Talbut said, in response. | "As a shareholder, it's not something that I would welcome and it's certainly not at this sort of share price I would be willing to sell at," Mr Talbut said, in response. |