James Moore: BP could be scapegoat for US in Ukraine wrangle

Click to follow
The Independent Online

Outlook BP is another company potentially facing trouble from the US, even though it is in many ways as American as Mom's apple pie. It's run by an American in the form of chief executive Bob Dudley and has far more invested over there than over here. Even its ownership is more American than British.

Last year the company paid $6.8bn (£4bn) in dividends, but American shareholders have long been keener on share buybacks. Right on cue, BP has just finished an $8bn programme of them and will now fund more.

None of this matters. To American eyes the company is as British as a hosepipe ban in the middle of a rainy summer. It's enough for it that its headquarters and listing are here. All this creates a problem for the oil major given the interests it has in Russia. These could leave BP playing the role of piggy in the middle amid the tussle between that country and the US over Ukraine.

So far BP is maintaining its commitment to its investment in Russian oil company Rosneft, not least because it's hard to see it getting anything like full value for its 20 per cent stake were it to walk away.

But it ultimately may have little choice. The president of Rosneft, Igor Sechin, has been placed on America's list of Specially Designated Nationals. In other words he's under sanctions. That raises questions about Mr Dudley, as a US national, sitting alongside him at Rosneft board meetings. And it could get worse than that.

America has precious little ability to influence the situation in Ukraine. So if the heat rises it may need to find a scapegoat to divert attention from its impotence. BP looks ideally positioned to play that role.

It might find it has to pick sides, however unpalatable that is from a financial perspective.