BP shares bounce back after Thursday's falls


Updated:

BP shares have pulled out of their nosedive despite fears the Gulf of Mexico leak had been spewing oil at up to double the rate previously estimated.

The battered stock rose seven per cent in a welcome bounce back after steep declines on Thursday.

This came in spite of new US calculations that up to 30,000 barrels a day of oil had been pumping into the sea and amid an escalating transatlantic spat over the disaster.

Protesters at a rally against BP

Call for action: Protesters let their feelings be known during a rally against BP

It also emerged that BP chairman Carl-Henric Svanberg is being summoned to Washington for a meeting with President Barack Obama as he steps up pressure on the firm.

BP lost seven per cent of its value on Thursday, hit by heavy share falls in the US and concerns that US officials were threatening to seek a ban on dividend payouts - crucial to British pension fund investments.

But a surge in oil prices due to better economic news provided some welcome respite for the embattled stock.

Oil prices reached nearly $75 dollars a barrel on expectations for robust demand as reports showed booming trade in China and lower US jobless claims.

Despite the fightback, BP shares are still around 40 per cent lower since the Gulf crisis struck when the Deep Horizon rig exploded on April 20.

The firm is now on day 51 of the oil disaster, which has become the worst in US history.

US Department of Justice officials are reportedly planning 'to take action' to make sure BP has enough cash to cover claims arising from the spill.

This was seen as a threat to the BP dividend, which has not been cut since 1992 and provides around £1 in every £7 of share payouts from UK blue-chip firms.

It is thought that BP is to seek a deal with the White House that could see the investor payouts held in 'escrow' - or deferred - until the group's clean-up liabilities are clearer.

Or it could propose scrapping the dividend for one quarter or paying it in shares rather than cash, according to reports.

BP has not confirmed whether it will pay future dividends, recently saying this would be discussed by the board next month.

It is due to make the next payout on June 22 and announce the subsequent dividend on July 27.

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