Friday, 18 June 2010

BP Is Finished - It's Only A Matter Of Time

Hayward: Bleak Prospects
It's getting pretty clear now that the United States government will settle for nothing less than the destruction of BP as punishment for the environmental and economic impact of the disastrous Gulf oil spill. This is the conclusion that a lot of people have now if not reached, then are certainly nearing. After BP's flat footed and presentationally poor chief Tony Hayward's performance in front of a bunch of nauseating US administrators yesterday, which demonstrated his stamina but nothing more than that, no one in their right mind can dismiss the idea that BP is gravely ill. The oil leak is bleeding it anaemic. Credibility, credit worthiness and gargantuan sums of money are all being poured into the stratosphere. Pretty soon, all that will be left is the name.

The evidence for this pessimism? The Telegraph's report today, which has been covered widely in the US on Fox and CNBC too, that the cost to BP for its liability will top $100 Billion should be enough, shouldn't it? No company can withstand that kind of bill and remain intact, no matter how large it is. That's the kind of money that takes down entire middle-sized countries. United States congressmen and women don't give two hoots about that, however, this being an election year. All they care about is the hysterical US public opinion. It's a simple calculation that US politicians from the pisspoor president down have made: 'the more we hurt BP (shake it down and pump it dry) and dogwhistle the anti-British meme, the more votes we get'. It's as pathetic as it is dismally feeble as it is dishonest.

BP will be gone by the end of the year. I'll put money on it.

The economic, political - even the historical - implications of this are truly frightening (particularly in terms of just how rotten the United States political classes have become) but they're separate issues that I'll have a stab at in a later post.

Or maybe someone else, if they accept the basic premiss (that BP is finished), could have a go.


  1. I couldn't agree with you more! =) I love reading the opinions of people from other countries about the U.S. political system. Its refreshing and great because usually I agree with them.

  2. That's interesting, Nerdy Girl. I often feel the same way about comments from abroad about the UK (although their aren't that many of them around!).

    It's not my intention to be rude about the US body politic I hope you appreciate. If that oil thing was happening to Britain, I've no doubt I'd be pretty damn angry about it too and looking for people to blame. That doesn't mean politicians here should (or would, I reckon) not-only pander to such understandable but ultimately futile emotions, but actually, deliberately, sleazily stir them up like Obama et al have (with notable exceptions).

    Seeing them do that is as disappointing as it is dangerous. This isn't peanuts we're talking about here. It's a massive multinational company with a network of vast investments and liabilities. That's before we mention the 100,000+ primary and God only knows how many more hundreds of thousands of secondary jobs at stake.

    We're are the statesmen when you need them? Where's the leadership? The way Obama is taking this thing, the whole sorry mess - an environmental tragedy, yes, but, nevertheless, an accidental one - will migrate into an economic disaster.

    He's not policy making, he's posturing and faking. And there I was thinking he'd be different. Silly me.

    (Mind you, I lived in the States as a boy when Carter was in charge. Obama is Lincoln compared to him.)

  3. OH, I dont take any offense at all. I did not vote for Obama. I am a proud military wife and I think what he wants to do to this country is disgraceful and how he handled the oil spill, even more so. We have an entire eco system as stake here, one we all rely on more than we think. I know this is a bit simple, but it kills me to think that marine life is suffering and cant do anything about it to help themselves. "They" just have to deal with it. Obama waited weeks to address the oil spill and when he did, he just wanted to point blame instead of a solution. A lot of people here are outraged that we Obama is getting blamed for not showing his face about this but he is our figure head. He is supposed to be our leader and our hope. I dont care if he doesnt have a great solution, but I just want to know he is doing something. Its almost like a child and a parent. The parent might not know what the hell they are doing but the child doesnt care because they are going to look to that parent for support, comforting, and help. Ugh, Obama "ruffles my feathers" so much and I can stand on my soap box about him all day, but I wont. lol

  4. Lol. Feel free!

    Great comment btw. Totally appreciate your views generally, and totally sympathise with the way you feel about the damage to mother nature being caused down there in particular. It's terribly sad.

    Sorry about the typos in my previous comment, btw. I was in a bit of a rush at work when I was trying to answer yours. Not much of an excuse for someone who's meant to be an English lecturer!

  5. BP isn't really British Petroleum any more anyway. I read somewhere that they had spent $100 billion buying US businesses (ARCO, Amoco, Castrol...) over the last couple of decades.

    Isn't there a wider issue here though, about whether it is really safe for any business to get involved in the US? Their legal system is notorious for ordering unfair damage awards. And now, it seems, their politicians only pay lip service to their commitment to free enterprise and fairness. Couldn't any company getting involved in the US go the same way as BP?

  6. That's a great point. I'm not sure the US administration is thinking that far ahead at the moment, however. It's certainly not looking beyond the end of its nose over BP ("Beyond Petroleum"?).

    I am sure, however, that they are determined to destroy BP come what may. No one seems to remember that they tried to do the same thing to Toyota not that many weeks ago. It looks to me like their current MO, and lends further weight to your suggestion that companies looking to do business in the US will now think twice.

    Perhaps that's precisely the idea underpinning the current rabble-rousing and litigious hysteria. It's a new brand of dirty tricks protectionism, taking advantage of any excuse, even tragedies as yet unresolved.

    Strange times.


Any thoughts?