When Barack Obama decided to turn ‘British Petroleum’ into a political weapon in 2010, after the Deepwater Horizon catastrophe, he neglected to mention the oil major was as much American as British.
A series of takeovers including Sohio and Atlantic Richfield meant that BP was among the biggest inward investors in the US and controlled several of the outfits carved out of John D Rockefeller’s Standard Oil.
The targeting of BP eventually ended up costing investors £49billion in penalties and court settlements and drove the company into the arms of Russia through its Rosneft stake.
BP’s willingness to return to the country of its humiliation owes more than a little to the world’s top bogeyman Donald Trump, says Alex Brummer
The return of softly spoken, tall Texan Bob Dudley to the US must be regarded as a seminal moment. The £9billion purchase of BHP Billiton oil shale deposits across several Southern states is a homecoming.
These things do not just happen. BP’s willingness to return to the country of its humiliation owes more than a little to the world’s top bogeyman Donald Trump.
Since he arrived at the White House Trump has delivered on his promises to deregulate energy and to defang the Environmental Protection Agency, one of the attack dogs deployed by Obama.
Moreover, the rise in the oil price to $70 a barrel means that shale extraction once again looks a good bet.
BP potentially could send a note of thanks to activist Elliott, which has been hassling BHP to simplify operations and release value. BP has made a good deal, since the fields being acquired in Texas, Louisiana and Arkansas are carried in BHP books at £10.5billion and originally cost £15billion when oil was trading at above $100 a barrel.
The decision by BP to jump into the breach comes after a period of rapid consolidation among shale drillers, which has racked up £87billion of deals this year as regulatory obstacles were vaporised.
BP’s return to America is unlikely to endear it to green campaigners in the US or enhance claims among big oil companies to be pioneers in non-fossil fuels.
Still, after the Deepwater Horizon experience, it is highly unlikely that Dudley and his team will be cutting any corners when it comes to safety or restoring Deep South wilderness to pristine condition.
Off the pace
Triathlete TSB chief executive Paul Pester ought to shift to Iron Man.
In spite of a mauling from the Treasury Select Committee, a reprimand from Andrew Bailey at the Financial Conduct Authority (FCA) and a just-revealed £176million hit from the IT meltdown, he refuses to be shifted from the chief executive suite.
The most remarkable aspect of the worst IT debacle to hit any UK bank is how little difference it has made. Most customers look to have shrugged off the diabolically poor response, frauds and the inconvenience.
‘Iron Man’: TSB chief executive Paul Pester
Some 26,000 of the bank’s 5million customers picked up their marbles and walked in a period when TSB was doing no promotion, but it gained 20,000 people who opened accounts through branches.
Pester says this is all due to the brilliance of his ‘partners’ – by which he means employees – but one suspects it has far more to do with the stickiness of consumers when it comes to shifting banks.
Truth is, for all of Pester’s upbeat bluster about staying on and promoting savings and mortgage offers again, he is far from being out of the woods.
The commissioned probe by Slaughter & May will probably deliver a withering verdict. On top of this one expects the FCA to come down on TSB like a ton of bricks.
Most significantly of all owners Sabadell thought they were buying into safe challenger bank when they bought TSB, far away from the chaotic politics of Catalonia. It has been badly let down, trust between London and Barcelona shattered and Sabadell has been plunged into loss and its valued online expertise plundered.
Pester is not going to win this event.
That was short-lived. Anne Richards was hailed as the asset management genius who would turn M&G into a great force when she was hired two years ago.
Now with the Prudential doing the splits and her own role in the mini old school Pru looking diminished, she is doing her own split and heading off to be boss of Fidelity International amid claims of jobs done.