Cameron to the rescue?
BP is reported to be considering asking UK Prime Minister David Cameron to intervene over the spiralling cost of compensation that US companies are demanding, in connection to the damages caused by the 2010 Gulf of Mexico oil disaster.
According to BBC business editor, Robert Peston, the company believes its financial revival is in trouble as the compensation system is being abused.
The company is also concerned that the financial burden of paying fictitious and inflated claims could make BP a takeover target and hopes the UK PM will raise the issue with the United States Government.
Apparently companies unaffected by the oil spill may have been receiving large cash windfalls as part of court-ordered compensation deals. In March this year, BP asked a US judge to suspend a £5.6bn settlement with local businesses. It said: ‘While the ultimate amount at stake is at present inestimable, awards for fictitious losses already are hundreds of millions of dollars and could reach billions.’ It claims that, in one case, a firm 200 miles inland, which conducted no business in the affected area, received $21m in ‘compensation’.
The question is, Would Obama be interested? and if so what can he really do?.