THE TIMES: Investors piled back into BP stock this morning as the City gambled that recent sharp falls in the company’s value over the continuing oil spill crisis had left shares at a bargain price.
Shares in BP traded up 7.8 per cent at 393p despite the ongoing threat that the company may be forced to cut or suspend its dividend while a new, dramatically higher calculation of the amount of oil spilt into the Gulf of Mexico from the fractured BP oil rig emerged.
“Big institutional pension funds saw yesterday’s price drop [to as low as 352p] as a watershed level at which they would buy,” said one City trader, who also pointed out that the oil giant’s stock would remain volatile as long as there was uncertainty surrounding the progress of the clean-up.
BP, once Britain’s largest company, has lost almost half of its stock market value, about £56 billion, since the explosion on April 20.
Shares in the company have been under renewed focus this week after political pressure from President Obama that BP cancel its dividend payment until the oil spill has been contained.
BP is due to pay its next quarterly dividend on July 27, a sum of about $2.5 billion (£1.7 billion). >>> Susan Thompson, Anne Barrowclough | Friday, June 11, 2010
