Oil for troubled water

5 Mar 2012 By Edward Hadas

The oil major’s Gulf of Mexico deal neutralises one set of plaintiffs – with a modest increase in expected payments. And if the injured parties are happy, U.S. federal and state governments are more likely to agree to fines which BP can bear without too much more pain.

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Shares of BP rose over 2 percent in early trading on March 5 after the UK oil major reached a provisional settlement with businesses and individuals affected by the 2010 Macondo oil spill. BP estimated the value of the settlement, announced after the close of trading on March 2, at $7.8 billion. The deal is subject to approval by plaintiffs and a U.S. judge. BP had already set aside $20 billion in a trust fund to pay for economic damages related to the spill. It still faces U.S. federal and state lawsuits over the 2010 incident, which killed 11 workers and resulted in nearly 5 million barrels of oil spilling into the Gulf of Mexico.
An earlier version of this item mistakenly gave BP’s market capitalisation as $95 billion, not 95 billion pounds, in paragraph four.

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