Gulf oil spill will dominate BP for years

There goes another 13%, or £12bn , from BP's market capitalisation. As a back-of-the-envelope calculation of the cost of the failure of the "top kill" operation to plug the leak in the Gulf of Mexico, the market's instant verdict seems as good as any. A successful operation may have made it possible for BP to emerge from the disaster with its dividend and its management intact. Neither now looks safe. Indeed, talk in some quarters has turned to whether Shell or ExxonMobil would make the better long-term owner of BP's assets. Some parts of the American media are not bothering with such niceties – just seize the US assets, goes the cry. As the daily expressions of anger from the White House intensify, the notion is not hopelessly fanciful. Robert Reich, the labour secretary under Bill Clinton, wants the US operations to be put into temporary receivership to ensure the company is working in the public interest. The best guess – today, at least – is that it will not happen. The more likely scenario is that BP will eventually cap the flow of oil by drilling relief wells. But that process will not be complete until August, which leaves a very long time indeed for the eventual bill to become bigger. It now seems clear that, even if BP retains its independence, this spill will dominate the company's affairs for years. The latest depressing news has piled uncertainty upon uncertainty. Optimists point to Exxon's revival after the Valdez spill in Alaska in 1989. Already, the comparison looks wrong. BP's spill is bigger; there are the company's past catastrophes, such as the Texas City explosion , to remember; and the clean-up operation in the Gulf of Mexico is more complicated. BP chairman Carl-Henric Svanberg, in one of his rare recent public outings, told the FT last week that BP was "big and important" for the US. The company is certainly big in the US, but whether it is ever allowed to be important there again is another matter.