 |
Obama to demand BP pay for gulf oil spill damage
A day after he vowed to fight the spill “with everything we’ve got”, Obama was to meet at the White House at 1415 GMT with the energy group’s executives, the first time he as done so since the crisis began nearly two months ago.
The spill -- called by Obama the worst environmental disaster America has ever faced -- threatens to distract him from a domestic agenda of bringing down nearly double-digit US unemployment and reforming Wall Street. Facing perhaps the biggest challenge of his presidency, Obama accused BP of “recklessness” in a televised address from the Oval Office.
Obama wants BP to establish a fund to guarantee it would cover the billions of dollars needed to clean up the mess and compensate people and businesses affected. The meeting with BP executives, along with the Oval Office speech and a two-day trip Obama took to the Gulf this week, were aimed at showing a hands-on approach to dealing with the spill. Opinion polls show most Americans believe Obama has been too detached and has not been tough enough toward BP.
 Shares in BP plc fluctuated in London Trading ahead of what promises to be a tense meeting between the oil company’s chairman and President Barack Obama in Washington. |
Obama and Vice President Joe Biden will meet with BP Chairman Carl-Henric Svanberg and other executives. Setting the tone for what could be a strong message to BP, Obama said on Tuesday he would tell the BP chairman “he is to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company’s recklessness.
“And this fund will not be controlled by BP. In order to ensure that all legitimate claims are paid out in a fair and timely manner, the account must and will be administered by an independent, third party,” Obama said. BP said in a statement its executives look forward to a constructive meeting. “We share the president’s goal of shutting off the well as quickly as possible, cleaning up the oil and mitigating the impact,” the company said. James Guiang, senior portfolio manager at Millennium Global Natural Resources Fund, said BP needed to cut a deal with Obama.
“Whenever you go up against a government, you’re not going to win,” he said. Obama also used his speech to call for legislation to break the US addiction to fossil fuels, and shares of solar groups in Germany, a big supplier of cells, rose on hopes of higher alternative energy uptake by the world’s largest economy. Shares in BP, which have lost nearly half their value since the spill began, were down 0.3 percent at 340p by 1110 GMT, underperforming the European oil sector index.
The cost of insuring BP debt against default rose, with five-year credit default swaps hitting a record wide of 600 basis points, according to Markit. Rating agency Fitch downgraded BP’s rating by six notches on Tuesday. Dutch bank ING said it expected Standard & Poor’s and Moody’s to follow through with more rating cuts. Adding to the company’s woes, a construction worker was killed at a BP refinery at Rotterdam in the Netherlands after a wall collapsed on him, a company spokesman said.
Rising fines
The company has already clocked up potential fines of up to $9 billion for the oil spill, based on a possible $4,300 per barrel fine for polluting major waterways. With tens of thousands of barrels leaking each day, the fines are rising. Analysts say BP will likely also lose out on government contracts, while its targets for expanded production will become tougher to achieve as it draws more scrutiny from regulators for new projects.
Its $7 billion deal with Devon Energy to buy Brazilian assets is under the scanner of the country’s regulators, the Times reported. BP dismissed reports the deal would not proceed. And Bank of America Merrill Lynch has ordered its traders not to enter into oil trades with BP that extend beyond June 2011, a market source familiar with the directive told Reuters. Neither BofA or BP would comment.
|
||||||||||||||||||||||||||||||||||||||||||||||||||
| AMANDA PAUL |  |
||
| Ukraine: a lost country | |||
| BÜLENT KENEŞ |  |
||
| What befell Niyazi-i Misri in the past is happening to Fethullah Gülen now | |||
| MÜMTAZER TÜRKÖNE |  |
||
| The 52nd anniversary of May 27 | |||
| EKREM DUMANLI |  |
||
| When a call for fairness and reason finds acceptance | |||
| ARZU KAYA URANLI |  |
||
| On Memorial Day a few words to make your day memorable | |||
| CUMALİ ÖNAL |  |
||
| Critical months for Egypt | |||
| ŞAHİN ALPAY |  |
||
| Uludere, test case for democracy in Turkey | |||
| EMRE USLU |  |
||
| Are the Kurds mentally divorced from Turkey? | |||
| GÖKHAN BACIK |  |
||
| Erdoğan, Gül and Davutoğlu: the inner bargain on Turkish foreign policy | |||
| DOĞU ERGİL |  |
||
| Qualities of power | |||
| MARKAR ESAYAN |  |
||
| Taking lessons from previous experiences with the military | |||
| YAVUZ BAYDAR |  |
||
| Qualm | |||
| ÖMER TAŞPINAR |  |
||
| A new phase in Syria? | |||
| JOOST LAGENDIJK |  |
||
| Europe can’t have it all. Or can it? | |||
| İHSAN DAĞI |  |
||
| Turkish foreign policy: Time for a re-evaluation | |||
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||
