BP bows down to US pressure
Today's meeting between Pres Obama and executives from BP has resulted in a major climbdown by the oil giant in the face of massive pressure from the US authorities. The company is believed to have agreed to put aside $20 billion in an escrow account to cover any costs and compensation as well as agreeing not to pay any dividends to shareholders this year. It is also believed that the US authorities have insisted that the agreement in relation to the $20 billion escrow fund is not a cap and could be increased in due course.
This is a major climbdown by BP in the face of a massive onslaught from the US authorities, the US public and US businesses. Even though political friction between the UK and the US did appear to have died down, after the weekend conversation between David Cameron and Pres. Obama, it is likely to flare up again due to what many see as the "mistreatment" of a major UK company with a massive presence in the US.
It has already been suggested that the $20 billion escrow fund will be administered by a lawyer who oversaw the payments to 9/11 victims, namely Kenneth Feinberg.
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