BP on the Defensive as Shares Drop

BP admitted that the cost of the Gulf of Mexico oil spill has risen to $1.43 billion USD. In addition, U.S. politicians pushed for the UK oil company to assume even greater liabilities.

BP has lost ~£58 billion (~$85 billion USD) in market capitalization since the April 20th disaster - when an explosion aboard the Transocean Ltd. drilling rig Deepwater Horizon killed eleven men and triggered the massive oil spill. However BP said today it sees no justification for the collapse in its share price.

But ever-harsher rhetoric from the Obama administration is worrying BP investors. There is immense political pressure in the United States for BP to halt dividend payments. The U.S. Department of Justice said yesterday it is investigating the company's dividend plans.

The Obama Administration has also demanded that BP pay millions of dollars in salaries of oil-industry workers laid off because of a U.S. federal moratorium on deepwater drilling.

So far, not a peep from the UK government. It continues to keep a low profile on the issue, despite increased calls from business to intervene on BP's behalf.