BP credit rating cut amid oil spill cost fears
Beleaguered oil giant BP came under more pressure today after its credit rating was cut amid fears over the soaring cost of the Gulf of Mexico disaster.
Concerns over the failure of repeated attempts to tackle the spill and the threat of a criminal investigation prompted ratings agency Fitch to cut the firm's credit rating from AA-plus to AA.
Moody's also cut its rating with warnings over the legal and financial burdens "likely to persist in the years to come".
The cuts will hurt BP because they raise the cost of its funding.
BP's shares recovered slightly today after two days of heavy falls, but since the Deepwater Horizon rig exploded and sank on April 20 - killing 11 workers - around a third of its value has been wiped out.
Moody's also expressed concern over the "mounting political pressure" on BP as US politicians lined up to attack the company.
Fitch added that the firm could suffer further downgrades if investment in new projects was diverted to tackle the crisis, and the clean-up bill exceeded its current worst-case scenario of around five billion US dollars (£3.4 billion) in any one year.
BP said earlier this week that the disaster had cost it 990 million dollars (£677 million) so far.
Its last "top kill" attempt to block the leaking oil well proved unsuccessful and the company is now working on using robot submarines in the latest move to stem the flow of oil.
But this technique has never been used before and it is far from certain that the procedure will work.
If it fails, the firm may be left with no other option than to rely on drilling relief wells that will take three months to complete.
Oil is spewing from the well at a rate of 12,000 to 19,000 barrels a day, meaning that between 18 and 40 million gallons has already been dumped into the Gulf, according to US government estimates.
BP has said it would pay 360 million dollars (£246 million) to fund six barrier "islands" to protect the Louisiana coastline.
- 1 Pope Francis issues top 10 tips for happiness
- 2 Disney heiress Abigail disowns her share of family profits in West Bank company
- 3 Now diplomacy has failed, boycotting Israel might be the only way we can protect the people of Gaza
- 4 Israel's propaganda machine is finally starting to misfire
- 5 Kelsey Grammer forgives the man who raped and murdered his sister in 1975
Russell Brand accuses Sean Hannity of terrorism after aggressive Israel-Gaza debate
Pope Francis issues top 10 tips for happiness
Kenny Ireland dead: Benidorm actor dies aged 68
Justin Bieber posts Instagram photo of a crying Orlando Bloom after Ibiza fight 'over Miranda Kerr'
Air Algerie AH5017 crash: Jet fell 30,000 feet in three minutes ‘due to violent storm’
The secret report that helps Israel hide facts
Land for gas: Merkel and Putin discussed secret deal could end Ukraine crisis
Woman and two children killed by mob in riots over 'blasphemous' Facebook post in Pakistan
Richard Dawkins tweets: 'Date rape is bad, stranger rape is worse'
Putin is 'thuggish, dishonest and reckless', says British ambassador to US
Boozy, ignorant, intolerant, but very polite – Britain as others see us
- < Previous
- Next >
iJobs Money & Business
£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
£28000 - £32000 per annum + benefits: Ashdown Group: Training Programme Manage...
Negotiable: Harrington Starr: Operations Engineer (Redhat, UNIX, Solaris, Data...