5 May 2010

BP shares at seven-month low

11:06 am on 5 May 2010

Shares in BP are at a seven-month low as concerns grow about the cost of cleaning up an oil spill in the Gulf of Mexico.

Shares fell 25 pence, or 4.3%, to 550.6p in early trading on Tuesday. The BBC reports they are now down more than 15% since the explosion on an oil rig two weeks ago.

On Tuesday, the company said it had started drilling a new relief well to stem the flow of oil into the sea. However, it added the drilling is estimated to take three months.

BP has admitted full responsibility for cleaning up the spill. It refuses to accept blame for the accident, as the failed equipment that caused the explosion was owned and operated by drilling firm Transocean.

BP shares closed down 3% lower at 558.5p.

Transocean shares also continued to fall, down 3.7% at $US70.11 in early trading in New York. Its shares have fallen more than 20% since the explosion.

BP said the cost of containing the spill and securing the original well is running at about $US6 million per day, and the amount is rising.

Experts have warned that the total cost of clearing up the spill, including compensation claims, could be as high as $US15 billion.

The leak began after the Deepwater Horizon oil rig sank on 22 April, two days after it exploded and caught fire, killing 11 men.