BP shares fell more than 3 percent in London, following a 5 percent drop on Tuesday, on worries that the company will have to suspend its dividend payment under pressure from U.S. politicians who say it should go to pay for legal claims and environmental damage in the Gulf.
The cost of protecting BP debt against default also rose sharply, with the five-year credit default swap widening 55 basis points to 315 basis points, three times higher that at the end of May, a London trader said.
The political drama in Washington and the drive in the Gulf to limit the environmental disaster were being watched closely by investors who have seen losses erase a third of BP’s value.
The disaster remains at the top of President Barack Obama’s agenda, a point underscored by his strong comments and his plans to head back to the Gulf Coast next week to inspect operations to tackle the worst oil spill in U.S. history.
