After Brief Reprieve, BP Heads Lower Again

After trading higher earlier, BP (NYSE: BP) has turned lower and is trading near the $30 per share level. Shares of BP are down nearly 50 percent since the spill started in April and are nearing the 52-week low of $29 per share from last Friday.

Executives from BP and other oil companies will testify to Congress today related to the Gulf oil spill. In addition, tomorrow the Chairman is meeting with President Obama.

In a prepared statement, Chairman and President of BP America, Lamar McKay U.S. cannot do without oil from the Gulf of Mexico.

BP may be forced to cut or suspended their dividend and start an multi-billion dollar escrow account to pay for a substantial portion of the Gulf spill damages. Democrats in Congress want the fund to total at least $20 billion.

Today, BP had its credit rating downgraded by Fitch Ratings. Fitch cut the Long-term Issuer Default Rating (IDR) and senior unsecured rating to 'BBB' from 'AA'. Fitch said "recent claims by U.S. state and federal authorities that BP escrow significant sums pre-emptively, ahead of any agreed claims process, represent a material change in approach, should it ultimately prove a legally supportable move against the company."

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