Tuesday, June 1, 2010

Energy $BP plunges after attempt to plug Gulf oil leak fails;Pressure Obama

· BP plunges after attempt to plug Gulf oil leak fails – BP fell the most in 18 years in London trading abandoning its latest attempt to plug the leaking Gulf well. The company said there will be considerable uncertainty over the potential damages. Bloomberg
· BP may not survive after Gulf of Mexico spill, Arbuthnot says – Arbuthnot Securities said that the company’s costs for the cleanup and litigation may rise to $10B and that the situation is no longer how much they will cut their dividend, but more an issue of if they will survive. Given its recent share price collapse, many expect the stock to become a takeover target. Bloomberg
· BP’s top kill fails, piling more pressure on Obama – BP said its top kill maneuver to plug the leaking well in the Gulf failed, ruined hopes for a quick end to the oil spill. It could be another two months for the company to turn off the gusher, which could undermine Obama as he is under increased criticism for a slow response to the disaster. Reuters

· Failure of top kill a huge blow for BP – The failure to stop the leaking oil well is leaving the company with diminishing options and is continuing to frustrate local residents as well as the Obama administration. The company will now proceed with a new method by removing the damaged riser and a cap will be placed straight onto it. This operation’s success also has no guarantee. If it fails, the only permanent solution would be the well BP is currently drilling, which could take two months to complete. Reuters
· Resignations from BP’s fuel oil team extend – Three more traders and the head trader in London left BP’s fuel oil team, according to sources on Monday. The total number of employees who have left the groupis now at 14. CNBC http://www.cnbc.com//id/37432694
· US pressure leads RIG to revise liability bid – Officials are calling RIG’s $27M liability request of $27M unconscionable. Regulators also expressed outrage over the company’s plans to pay $1B in dividends. Reuters
· Crude slumps on concern of China’s growth, stronger dollar – Oil fell for a second day  in New York on concerns about growth in China. Oil slid lower after China’s PMI Index fell to 53.9 in May from 55.7 inApril. Bloomberg

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