BP Shares Gain In Mildly Higher FTSE 100

By Sarah Turner Of MARKETWATCH BP shares gained in British share trading on Friday, paring a fraction of the steep losses made since the explosion that sparked a massive oil spill in the Gulf of Mexico. BP (BP) climbed 4% to 374 pence, taking losses since the explosion on April 20 to 42% for the firm's London-listed shares. This week, the oil firm set aside $20 billion in an escrow account to meet compensation claims from the oil spill and also said that it will suspend dividend payments, reduce capital expenditure and step up asset sales. BP's Chief Executive Tony Hayward told a congressional panel Thursday that it's still too early to determine the exact cause of the Deepwater Horizon rig explosion on April 20 and subsequent oil leak. "The CEO chose to dodge direct questions relating to the cause of the accident on the Deepwater Horizon Rig on the 20th April. This issue is critical as no party involved has yet to assume responsibility for the accident," said analysts at Dolmen Stockbrokers. They also noted: "The Coast Guard reported that the relief wells that BP are drilling are ahead of schedule which brings forward the possibility of stopping the leak in July." Citigroup analysts said: "In the absence of more definition on costs and until the well is finally killed the stock will be buffeted by newsflow." Rival Royal Dutch Shell (RDSA) shares were up 0.3% and the U.K. FTSE 100 index rose 0.4% to 5,275.62. Other European shares were also higher, with the region on track for its eighth straight gain. U.S. stock futures were flat. -Sarah Turner; 415-439-6400; AskNewswires@dowjones.com (END) Dow Jones Newswires June 18, 2010 06:55 ET (10:55 GMT)