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BP Suspends For Q1-Q3 Of 2010
Update: BP says to increase planned divestments to $10 billion in next 12 months.
The barrage of very angry English tabloid headlines is coming. The company announces it expects to make $30 billion in cash flow from operations in 2010. Problem is in 2009 it had $20 billion in CapEx, so even with dividend cut, this is a stretch.
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Cancels or suspends?
No further dividend for the year
Stock is going nuts not sure which way to turn .50 1min candles..
Edit: apparently it will cancel DIVs for 3 quarters of 2010, but is committed to 2011 dividends
no cap on liabilities to US Government + no 2010 dividend + continuously leaking spill = 4% jump in BP stock?!?!?!?! WTF
MarketWatch says first-quarter dividend canceled, second and third quarter suspended.
Bingo!
Now they can say the big bad President made them do it.
Must be the reason for the firmness in the ADR's....
I guess the Leo's of the world will point to this as a reason why we should go long in every equity - especially in stupidity and ignorance.
They're gonna need a bigger boat...
LMAO!!!!!
Will any of those headlines be directed at BP mgmt for reducing the value of their company through negligence?
Or are we fully into the era where to speak of a misdeed is more troubling than the misdeed itself? Because that would be a very American response.
In the order of your questions.
No
Yes
An American response for a British company? Meaning that only Americans avoid speaking truth to themselves?
Oh will the British papers be a hoot in a few hours....
We want our bloody dividend! Damn Yanks! Dodgy bunch of wankers they are!
Did i hear the CEO say "we care about the small people"?
shades of Leona Helmsley...
Yeah, it sort of gave me one of those warm and fuzzy feelings knowing he cared.
Ah, who do you expect they will writing the checks to?
So, if the small people are now unemployed, should they get down to the beach and work on the cleanup crew and earn a check? Or are they too small for that?
http://en.wikipedia.org/wiki/All_men_are_created_equal
Fortunately, through science we now know that this is not true, that all men are created equal. There are a number of things mothers can do while pregnant (drink, drugs, no vitamins) that make it game over for the newborn before he even puts in an appearance. Cocaine babies will not ever be able to compete with one who's mother did no drugs and took her vitamins while pregnant. But, whatever. If the Constitution says we are all created equal, then we must be.
and hopefully all those small people (crack babies) in Louisiana will know their place and bow before the British Crown and BP which has long been the main proponent of the NWO.
Oils not well...
BP PENSIONERS ROBBED!
What happened to the rule of law in America? I'm surprised the Brits are folding this quickly. There must be a story behind the story...
IMHO this mess is much worse than we're being told and the President has agreed to limit the political damage he could inflict in exchange for the $20 billion up front. It's in his best interest to limit his problems as well. The only losers are everyone else. No biggie.
Rule of Law?? Hmmm, I've heard of that. I would ask the bondholders of Bear Stearns, Fannie, Freddie, Wachovia, WaMu, Lehman, Indymac, Chrysler, and GM. I'm sure they could tell you all about the "rule of law" thing. That damned piece of paper is laying around the National Archives also too.
If we have a rule of law, it is Stein's Law.
"If something cannot go on forever, it will stop."
I do have a rule of law. And I consume it in my Stein as much as possible.
BP is now implicitly backstopped by the US government.
The $20billion "Escrow Fund" was aimed at capping what was unlimited and uncertain liability risk. The fund is to be administered by the US government.
THink about it. What if BP goes into bankruptcy, is nationalized by the UK or if liability exceeds $20 billion? Do you remember what happened to US tobacco companies and liability? The Master Settlement was for $206 Billion.
If liability exceeds the "Fund" then the US government and taxpayer are on the hook for it ALL. In fact BP could strategically default in case of high liability and leave US to foot the bill forever.
THe US was held hostage and in essence blackmailed into this agreement. That's because the Fed would have to bail the entire UK banking system and pension fund if BP stock dropped to pennies or BP defaulted. That would have rekindled the entire crisis of 2008, reintroducing systemic credit risk only this time at the sovereign level as well.
US has backstopped BP to avert a systemic crisis.
There are at least 2 errors in your second sentence, so I stopped reading....
==== Obama says BP will set aside $20 billion for spill(AP) – 21 minutes ago
WASHINGTON — President Barack Obama says BP will set aside $20 billion to pay the victims of the massive oil spill in the Gulf of Mexico.
Obama said the $20 billion will provide substantial assurance that legitimate claims made by people and businesses in the Gulf will be honored. The president also revealed in a statement at the White House that the British oil giant agreed to create a $100 million fund to compensate oil industry workers whose livelihoods have been disrupted by the environmental catastrophe.
Obama said the $20 billion is not a cap, adding that the people of the Gulf have his commitment that BP will meet all of its obligations to them. He made his remarks after meeting with BP Chairman Carl-Henric Svanberg.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.
WASHINGTON (AP) — BP will set aside $20 billion to pay the victims of the massive oil spill in the Gulf, senior administration officials said Wednesday, as President Barack Obama met with the oil giant's top executives. BP is acting under heavy White House pressure in dealing with the worst environmental disaster in U.S. history.
The independent fund will be directed by lawyer Kenneth Feinberg, who oversaw payments to families of victims of the Sept. 11, 2001, terrorist attacks. At present, Feinberg is known as Obama's "pay czar," setting salary limits for companies getting the most aid from a $700 billion government bailout fund.
The $20 billion is not a cap — if legitimate claims outstrip that amount, then BP will required to pay more, one administration official told The Associated Press.[...]
You're naive. This was a political negotiation. There was heavy pressure from the British government. THe fact that we are in day 58 of the spill with no solution attests to Obama's unwillingness to harm oil interests. For his own reasons.
This is a huge victory for BP because it signals the US government is going to be in their corner every step of the way.
And if BP defaults, gets nationalized or goes BK there is no protection from the liability for the US government.
I may be naive, but we will only know that for sure later. Your post contained flagrant errors, and we know that right now...
Stock up 3% despite cancelation of dividend payments! Think BP doesn't have a Bernanke put?
BP going higher short term. Just sayin'.
Disclosure: Long BP
What you're calling "errors" are just where my interpretation varies from the official quoted gruel you re-posted. If you believe that tripe, God bless you.
what you said is complete garbage.
No real liability of the tobacco companies was established. If you review the litigation, the companies rarely lost.
The deal was somewhat like this one in that the pols found an opening to extract more Tribute from a legitimate business. More money for them to use to keep the beggars in full beggar mode.
It'll be curious to see how fund managers in the US explain to thier 'clients' why they now own stock in the most hated oil company here.
How about, "Cramer told us to buy". Would at least be worth a try.
Hey i just moved from Aus to London, i'll head down to BP HQ with any queries you guys have. Just lay them out here.
Weather is good, im missing aussie winter for london's 'summerlite'.
Just got off the phone with a friend of mine who is a mud engineer working in Alaska right now. Says word on several rigs he visits is that BP is looking to sell most of it's U.S. assets. Says he doesn't understand why in the world BP tried a topkill and somewhat echoed Rebel's observation that there is something they are not disclosing because their actions don't square with the facts known to the public. In case anyone missed Rebel's comments last night, here they are:
http://www.zerohedge.com/article/matt-simmons-revises-leak-estimate-120000-barrels-day-believes-oil-covers-40-gulf-beneath-su#comment-416186
I agree. Things don't add up which means this is a much bigger problem than we're being told.
"Just got off the phone with a friend of mine who is a mud engineer working in Alaska right now."
BTW, when I was a very young child, after playing in the mud and coming home filthy dirty, in response to my mother asking me what happened I told her I was a mud engineer. I avoided the spanking but not the bath. :>)
LOL at your youthful mud engineering studies. I noticed that TD updated the story with BP's capex numbers. "BP capex" is an oxymoron. Just ask anybody how works for Alyeska or on TAPS. I already knew this, but my friend mentioned it also.
OK let's get real about the GOM oil flow. There doesn't really seem to be much info on TOD that furthers more complete understanding of what's really happening in the GOM.
As you have probably seen and maybe feel yourselves, there are several things that do not appear to make sense regarding the actions of attack against the well. Don't feel bad, there is much that doesn't make sense even to professionals unless you take into account some important variables that we are not being told about. There seems to me to be a reluctance to face what cannot be termed anything less than grim circumstances in my opinion. There certainly is a reluctance to inform us regular people and all we have really gotten is a few dots here and there...
http://www.theoildrum.com/node/6593/648967
Lizzy,
Looks like you've been mucking around with the oil boys, getting all greasy and slippery and glistening and........er........so how have you been Lizzy? :>)
Those that panicked first and immediately dumped are looking like heroes.
Where are all the analysts that said the haircut was overdone when the stock fell back to the 50's.
Something I don't believe Ive ever seen ----------Cutting a dividend that was declared and payable in 5 days ------
Wait until they file for bankrutpcy and are forced to liquidate.
GOM may be the Last Straw for the whole shooting match.
In time, the story won't even be BP any more... it will be the environmental devastation ion the Gulf. Sure, Valdez was terrible, but so far away. The dead zone in the Gulf is going to be mindbogglingly huge and sad sad sad. Centuries from now, any historians we have left will be appalled by the scope of this thing.
I wonder who holds the counter-party risk...?
The American people.
Everything (I mean everything) depends on the relief well and stopping the flow from the very damaged blowout well. BP will walk away from BP America if the well can't be capped. So agreeing to pay $20 billion is a smart move. The money will come from additional debt on exisiting BP America assets. No new money will come into the USA. If the well is capped, the cost will be contained. If Matt Simmons is even partially right, there will be no containment and the liability goes to hundreds of billions, perhaps trillions and BP goes away and the courts fight over the remaining crumbs. The fines alone at $4300+ per bbl of spillage will reach $20 billion. So citizens will be fighting with the Govt over the fund. Anyway, there is enormous risk in this market until the BP well is capped.
When a deal is reached this quickly, there was either a lot of money left on the table by one party, or one of the parties had no clue what they were doing.
If neither of those is true, then there is something both parties know and they do not want the rest of us finding out through the normal legal channels.
Agreed. And why is this man smiling:
http://www.businessinsider.com/busted-bp-ceo-caught-smiling-after-leaving-meeting-with-obama-2010-6
Just wait till the Oil Hurricanes.
I was listening to Rush Limbaugh earlier. He tried to downplay this by pointing out the fact that the amount of oil pales in comparison to the amount of water in the GOM.
Something on the order of 660 quadrillion gallons of water. If the well goes unstopped at the amount it is currently estimated at, it would equal just one millionth of a gallon of oil per bathtub full of water, if it spews for 120 days total. He also feels certain that the relief wells will work, which puts him in the minority.
Guess he has not looked at the pictures on the tube lately. It does not matter what the math says, in his neck-of-the-woods, the amount per gallon is well above that. Although the majortiy of the gulf will not be affected, the portion it does affect will be devestated.
Whats he gonna say when it starts washing up on his property? I like Rush and listen to him all of the time, but sometimes he has me scratchin my head. He may need to rethink his take on the situation.
"I was listening to Rush Limbaugh earlier."
__
We began to recognize in them a strange obsession. After all, they are emotionally inexperienced, with only a few years in which to store up the experiences which you and I take for granted. If we gift them with a past, we create a cushion or a pillow for their emotions, and consequently, we can control them better.
_
Was listening to Rush also. He was using 20,000 barrels a day instead of the new estimates which are much more. He was also assuming it will be capped in August. Was a bit disappointed in him. Sent him e-mail told him to see article on drudge for new estimates and told him I bet well is not capped in August. Doubt he will admit in August he was wrong.
Shrill, baby, Shrill!
I used to listen to Rush but had to stop. His political commentary is extraordinary and is only matched by his own imbecility where science is concerned. If he thinks this oil spill is a drop in a bucket and will be fixed in no time then that reaffirms in my mind that:
A) We are screwed
B) Rush still knows nothing about science.
If MS is anywhere near right then the damages from this leak will run in the trillions, not billions. Who will pay, BP or the USG?
What will go to ZERO first, BP's share price or the USD?
BP North America has assets over 50 billion. Once clean up liability begins to materially exceed 50 billion BP files bankruptcy and walks away with its non-north american assets in tact.
And if that happens, we do to the UK what the UK did to Iceland. The same situation for all intents and purposes.
Settle their liabilities for them?
That could be a euphemism for it, I suppose.
The real question is how much of this will be used to compensate GOM claims and how much will be used by the White House to pay down other liabilities that that Congress has run up the bill on.
We know how desperate the White House is to get its hands on some cash...
Ok, why did I hear 2.5 million bpd quoted this morning on the local news? And why does every other estimate seem to be in the thousands? Did I imagine that? Is this a stupid question?
Not a stupid question. Either you heard wrong and they said gallons per day or local news said barrels per day when they should have said gallons per day.
The exact flow is unknown and almost unknowable. However, since a barrell of oil is 42 gal, then 50,000 bls = 2,100,000 gallons. Add in a factor for journalistic math and they can get 2,500,000 somethings.
Aha. Thank you. Early dementia.
It is not dementia, it is the early-onset effects of the benzene cloud gently wafting your way - according to wikipedia - the stuff smells sweet enought that it was included in early after-shave lotions. Now it has been linked to various forms of DNA damage. At least the UK pensioners are far enough away that they can't smell the mess that British Polluters have left in the toilet bowl formerly known as tGoM.
I'll see you that benzene cloud and raise you a tar ball.
Yes - Benzene is complicit in Leukaemia and a high number of nasty cancers outside blood. (Bladder, Lung and pancreatic.)
As dangerous as Asbestos but quicker acting.
Not to be messed with without proper protective clothing and breathers. The clean up workers have been given this protective gear -Yes?
BP - Beyond Protection
And I might remind you that BP is "self insured" so they are liable for ALL Claims - ALL. OH dear another James Hardies
The Gulf Stream ends up putting oil around England and northern Europe -- of course, before that happens the entire Eastern Seaboard of the USA gets a taste first :((
reiterate buy the 8% aud denominated debt that matures Q1 next year - around 97-98 level - a steal
Hey everyone!
We were all wrong.
BP does care about us!
http://www.msnbc.msn.com/id/21134540/vp=37736716�
[said twice go 4:00 into tape]
"Because we care about the small people."
There, feel better?
These "small people", are they Leprachuans (spelling) or Elves?
I predict 150/bbl oil in the next 36 months.
What oil company in its right mind would do ANY exploration anywhere in the US after BP?
We will become even more dependent on foreign oil than we are now, and we will pay whatever we're charged.
BP's $20 billion will end up costing Americans more than $200 MMM.
Any oil company that is willing to follow basic drilling and safety standards that are industry norms and apparently followed by almost everyone except BP.
Although it's still early, it appears that BP made a minimum of five critical errors that were clear and dangerous errors in the views of their contractors and even their own technical people. The final say for those errors apparently was with a BP manager.
For chrissake, Halliburton told BP that the cement job planned was unsafe. HALLIBURTON!!!!
And the stock goes up. From 31 to 32 on the news. This market continues to confuse me.
Heres a question. Where is the stock going? Forget the current rise in price. Where will it be in a week or a month? Any thoughts? Also, any opinions on a purchase of BP?
EURO bullish warnings mentioned earlier, have strengthened today. Vice versa for the USD index of course.
I have detected EURO buying support for several weeks now.
XAUEUR daily chart gives bearish warnings as of today.
This could be an important development.
The proprietary indicators I use in my technical analysis can identify trend changes before they occur.
http://stockmarket618.wordpress.com