James Kirkup at The Telegraph:
The oil firm has seen almost £50 billion wiped off its value since oil began leaking from one of its pipelines following an explosion on a gas platform in the Gulf of Mexico.
Investors say the hardline approach taken by Mr Obama – who has promised to “kick ass” over the incident – has contributed to the share price declines. The US administration last night threatened to block BP paying a dividend in order to ensure victims of the spill off the coast of Louisiana got sufficient compensation.
The pension funds of millions of Britons have been hard hit – as exposure to BP, Britain’s biggest company, is high.
Boris Johnson, the Mayor of London, this morning became the most senior UK politician to defend BP, saying “anti-British rhetoric” levelled at the company was a matter of “national concern” and that the oil giant was paying “a very, very heavy price” for what had been an accident.
“I would like to see a bit of cool heads rather than endlessly buck-passing and name-calling,” he said. “When you consider the huge exposure of British pension funds to BP it starts to become a matter of national concern if a great British company is being continually beaten up on the airwaves.”
Speaking to reporters in Afghanistan, Mr Cameron refused to follow suit, instead offering his backing to Washington.
He said: “I completely understand the US government’s frustration because it’s catastrophic for the environment.
He added: “BP needs to do everything it can to clear up the situation.
“The most important thing is to mitigate the effects and get to the root of the problem.
“Of course it’s something I’ll discuss with the American president when we next speak.”
Rosa Prince, Fiona Govan and James Kirkup at The Telegraph:
Carl-Henric Svanberg, the chairman of BP, who has been summoned to the White House next week, met George Osborne, the Chancellor, at Downing Street to discuss what more could be done to find a solution to the crisis.
David Cameron spoke on the phone to Mr Svanberg, stressing that it was in “everyone’s interests that BP continues to be a financially strong company”. Tony Hayward, BP’s chief executive, yesterday warned its biggest shareholders that the firm was “likely” to suspend its forthcoming dividend payment, of $10 billion (£6.86 billion), for up to six months.
Business leaders have criticised the Prime Minister’s failure to demand that Mr Obama tone down his antagonistic statements. The president has described the company as “British Petroleum,” a name it has not used for years.
Asked about Mr Obama’s suggestion that he would like to be able to sack Mr Hayward, Mr Clegg said: “I don’t frankly think we will reach a solution to stopping release of oil into the ocean any quicker by allowing this to spiral into a tit for tat political diplomatic spat.
“I’m not going to start intervening in a debate which clearly risks descending into megaphone diplomacy.” His words, during an official visit to Madrid, highlighted the continuing reticence of Mr Cameron over what has come to be seen as the first test of the “special relationship” of the Coalition.
The Prime Minister has faced calls to be more robust in his defence of British interests, particularly given BP’s key relationship to the pension pots of millions.
BP is responsible for one in every six pounds paid in dividends into pension funds in the UK, and the company is now likely to bow to pressure from the Americans not to pay the planned $10 billion next month.
Mr Cameron and Mr Obama are due to speak by video-conference this afternoon and will discuss the issue, hours before England and the US play each other in the World Cup. No 10 initially suggested that BP would be raised only “briefly,” with the main focus of the conversation expected to be on Afghanistan.
Delia Lloyd at Politics Daily:
Of particular concern are the pension funds of millions of Britons, where BP’s position at the top of the London Stock Exchange has made it a bedrock investment for almost every pension fund in the country. The firm’s dividend payments, which amount to more than £7 billion ($10.2 billion) a year, account for £1 in every £6 paid out in dividends to British pension plans. Were BP to go belly up, this would directly impact the lives of millions of British workers.
But the real ire toward the United States over BP is political. Part of it is generated by President Obama’s seemingly calculated insistence on referring to BP as “British Petroleum” (a moniker the company dropped years ago in favor of the initials BP). John Napier, the chairman of the British insurer RSA, accused the Obama of being anti-British and “prejudicial and personal” in his dealings with BP. The mayor of London, Boris Johnson, went a step further, decrying the “beating up” of a “great British company on the airwaves” as a “matter of national concern.” As one columnist in the Daily Telegraph summed up the sentiment over here: “Much of the rhetoric from other American politicians is plainly jingoistic claptrap with a beady eye on their own chances in the U.S. midterm elections.”
But the Brit’s aren’t just angry with the Yanks for beating up on BP and its mother country. They are also angry with their own prime minister — David Cameron — for not sufficiently defending the United Kingdom from attacks by its former colony. Cameron’s statement that he “completely understood the U.S. government’s frustration” with the fallout from the oil spill was widely perceived as “dithering,” if not out and out deferential toward the United States. (The two men are scheduled to speak by phone on Sunday.)
The subtext underlying all of this, of course, is just how much the United Kingdom will continue to be America’s “poodle” in the future, a reference to Tony Blair’s perceived submissive relationship with George W. Bush during Blair’s tenure as prime minister. With a relatively new president in America and a brand-new prime minister in the United Kingdom, the two countries are entering into a new phase in their relationship. And one of the big questions on the table is just how much Cameron will be willing to distance himself from Washington.
How the British leader responds to this current crisis may tell us a lot about where Anglo-American relations are headed. At a minimum, the prime minister needs to convey that the Brits object to all this “ass kicking” by President Obama.
And, by the way, that’s “arse” to you, sir.
Heather Horn at The Atlantic
Fraser Nelson at The Spectator:
Barack Obama knows language and innuendo: he will know what he’s doing by deploying what Boris Johnson rightly calls “anti-British rhetoric” in the BP disaster. BP has not – for many years – stood for British Petroleum’ – you won’t find the two words anywhere in its annual report. But you hear them plenty tripping off the presidential tongue, as if to point the finger on the other side of the Atlantic. It makes you wonder how highly he values UK-US relations: Bush was genuinely grateful for the fact that Britain was America’s most dependable ally in Iraq and Afghanistan. It’s hard to imagine Bush using the rhetoric that Obama has so quickly resorted to. It does make you wonder: is there still a “special relationship” or is America just not that into us?
When Piper Alpha exploded in 1988 and killed 162 in the North Sea, no one in Britain spoke suggestively about an American company. Where the parent company is domiciled does not matter: you get British companies whose share capital can be owned by various people. BP is 40% owned by British shareholders and 39 perccent owned by American ones: its board has six Americans and six Brits. This disaster happened on an American-owned, Korean-built rig leased by BP’s American subsidiary. But to listen to Obama, it is as if a few blokes from Stoke-on-Trent sailed over, and drilled a wildcat well – then buggered off and left Uncle Sam to suffer all the damage.
Transocean, the owner of the destroyed Deepwater Horizon rig, relocated for tax reasons first to the Cayman Islands and then to Switzerland. But blaming the Swiss would not quite have the same political effect in America. Halliburton, the controversial Texan firm once chaired by Cheney, had a hand in the ‘cementing’ processes that failed to protect the rig against explosion.
There is fault everywhere in this disaster. Doubtless it deflects anger from Obama and other senior American politicians to ramp up anti-British sentiment – when you consider the appalling performance of BP’s chief executive, and Fergie on Oprah, there is reason to believe that Britain’s reputation in America stands at its lowest ebb since 1776. This has a tangible effect. As Allister Heath argues in City AM today, British companies are reporting that it’s harder to do business over there. Obama is talking about stopping BP dividends – £1 in every £6 paid in dividends in Britain comes from BP. To damage BP’s dividend payment scheme is to damage British pensioners: you can’t just hit a ‘company’ without hitting either its customers, or its investors (in this case, several million British pension savers).
Simon Jenkins at Huffington Post:
The reputation of the American president has taken a terrible tumble in Britain. Barack Obama’s stock may be falling in America, but his response to the Gulf of Mexico oil disaster has seen it collapse on this side of the Atlantic, where until recently it was stratospheric.The reason is his daily litany of abuse of BP for what is regarded as a tragic accident, of the sort that periodically afflicts America’s once-favorite industry, oil. In the British press the accident is universally attributed to the actions of the American rig-contractor, Halliburton, if not the rig owner, Transocean. It apparently suits Obama never to mention this. His xenophobic blaming of BP as ultimate owner of the oil has left his fans shocked and deflated. The blame lies with America’s thirst for oil and eagerness to find it wherever it can off its coast.
This was an accident. Surely everyone should gather round to rescue the situation, not stand on the beach shouting insults. No one seems to accuse BP of having failed to do something specific. Everything has been tried at vast expense, and at last appears to be working. The rig was legal and being operated at the time of the accident by Halliburton under American regulation and inspection. If the president has some secret salvation plan up his sleeve, he should surely tell the company.
Is the president seeking to play god? An oil blow-out may be nasty, indeed very nasty, but what is it to do with the president? He is not an oil engineer. If he can do nothing constructive to rectify the disaster, why pretend otherwise and merely parade his impotence?
David Frum at FrumForum:
BP has for years been “BP” plain and simple. Yet Britons are noticing that President Obama keeps referring to the company as “British Petroleum.” They sense an attempt to mobilize American nationalism against Britain in order to evade political blame for the disaster. Every British pension fund is deeply invested in BP. One out of seven dividend pounds paid in Britain is paid by BP.
And in the wake of Obama’s BP-bashing, other smaller incidents are acquiring more serious significance: the banishing of the Epstein Churchill bust from the Oval Office – the off-hand treatment of Gordon Brown – the ungracious acknowledgement of Britain’s role in Afghanistan.
Nor is it only Britain. In the past months, I’ve heard still more wounded complaints about Obama’s disregard from diplomatic representatives of other NATO allies. George W. Bush may have damaged relationships through inadvertence and high-handedness. With Obama, it’s beginning to look more like deliberate policy.
Bagehot at The Economist:
COMPARE and contrast: the front page of today’s FT says “Cameron steps into fray to defend BP”; the Telegraph splashes with “Cameron fails to back BP in fight with Obama”.
The truth is, the little that the prime minister and his colleagues have said in public about President Obama’s attitude to BP is open to either interpretation. When they were anticipating the likely foreign-policy crises of their tenure (and the diplomatic issues that might strain the coalition), a row with Britain’s closest ally over an oil leak in the Gulf of Mexico wasn’t very high up the list. They are struggling to work out how to deal with what is an unexpected and delicate foreign-policy problem.
But then, Mr Obama’s remarks and behaviour are open to interpretation too. Some in Britain are keen, perhaps too keen, to view them as part of a pattern of anti-British prejudice on his part. This argument tends to dredge up his removal of the Churchill bust from the Oval office and the accusations made against the British in “Dreams from my Father”.
Or rather, allegedly made: Mr Obama doesn’t really make many, as anyone who has taken the trouble actually to read the book will discover. It makes one oblique reference to his Kenyan grandfather’s alleged mistreatment by the colonial administration, but that’s it. I think the Americans’ stubborn position on the Falklands, going along with the view that Britain and Argentina ought to negotiate, while knowing that London has no intention to, is a much more serious affront.
But in general there seems to me to be too great a willingness to find deep, antagonistic motives in Mr Obama’s behaviour. It’s fun to get all patriotic and offended, but there is another and more plausible explanation. Mr Obama is a politician in a desperate fix, and has reached for the easiest, almost the only, possible target on which to deflect some of the heat.
This really is the silly story of the week.
The fact that BP is being “beaten up” isn’t what’s causing the share price to crash – it’s the bloody catastrophe that’s doing that, and it really doesn’t need much help. If British pensioners are losing money that’s because their fund managers over-invested in BP and didn’t properly account for the risk of a disaster like this one.
What does Obama’s “anti-British rhetoric” amount to anyway? Unless you’ve seen something I haven’t, it amounts to this: referring to BP as “British Petroleum”. The swine. (Apparently they changed their name a few years ago to BP to avoid being seen to have anything to do with Britain or petroleum – exactly the kind of absurd PR fiddling that under other circumstances, these same critics would be fiercely deriding, and not exactly “patriotic”).
Here’s the thing: if Obama calling it “British” is such a problem, why are we proudly defending this “great UK company”?
It’s not the crass opportunism that gets me down about this stuff, or the (faux-)stupidity, it’s the chippiness. It makes us seem so insecure, always seeking out “slights” from abroad to get upset about. Whatever happened to those great British traits of effortless confidence and sang-froid (excuse my French)?
So the British, including leading politicians, are steamed at American anger at BP, seeing in it anti-British prejudice. Huh? I don’t see this. They’re cheesed off that Obama has referred to “British Petroleum,” pointing out that the company changed its name to “BP” years ago (therefore, Obama can only be using the name “British Petroleum” in his public remarks to stoke anti-British prejudice). Nonsense. I had no idea until very recently that “British Petroleum” was no longer in use, and I think very few Americans outside the oil industry did either.
More importantly, this emerging British narrative depends on the belief that if not for anti-British prejudice, Americans would be tolerant and patient with BP’s behavior. I’m sorry, but that’s demented. Since this crisis began, we have learned that BP never had a plan to deal with this sort of thing, despite telling the government that it did. We have learned that BP has a terrible safety record, and ignored clear warnings leading up to the Deepwater Horizon explosion, warnings that something was going very wrong on the rig. We have learned that BP lies. We have seen BP try to keep journalists from telling the full story of what the company’s negligence has done to the Gulf and the people who depend on it. And we have seen entire regions, communities, local economies and ecosystems put in serious peril of extinction.
Do the British seriously believe that if BP were Exxon, or any other American company, that the American people would be less angry at them over what their corporate recklessness (aided and abetted by American regulatory laxity) has done? Absurd. Gobsmackingly so.
UPDATE: Clive Crook