BP on Tuesday confirmed that chief executive Tony Hayward will quit and said it would take a charge as a result of the Gulf of Mexico oil spill amounting to $32.2 billion.
Following are reactions to the news:
Peter Sutherland, Chairman of Goldman Sachs International and former Chairman of BP:
I am saddened by the fact of Tony's departure but heartened by his courage in ending a brilliant 28-year career at BP. As a professional he has always been widely admired and respected in the oil business. Nothing became him like the manner of his going. I worked with Bob Dudley and I am delighted by his appointment, albeit in sad circumstances. He is a man of tremendous resolution and I am confident he and Carl-Henric Svanberg will make an exceptional team.
RICHARD HUNTER, HARGREAVES LANSDOWN STOCKBROKERS
The triple pronged approach of increased provisions, asset sales and a new CEO should be a potent mix in forming a strong future foundation.
The dividend position will be clarified over the next six months or so, but in the meantime this removes another plank for a reason to chase the shares. Even so, today's statement does give some reassurance and despite all its woes, BP remains a buy in terms of the market consensus.
SIMON HAWKINS, AMBRIAN CAPITAL
The 32 billon of provisions is slightly higher than we thought.
I'm not thinking that this is going to be the last charge that will come as a result of this, but at least its the first stab and we get a feel for the quantum of it.
Overall, I think it should be taken as a positive moving forward. They have taken steps to draw a line under what was an unlimited liability.
Together with the new CEO and strong financial position going forward, on the back of asset sales, this should provide some confidence.
JASON KENNEY, ING BANK
Overall we see BP being reinvigorated by the new strategy in play, a new CEO and the worst news for the company concerning U.S. GoM (Gulf of Mexico) costs now being out there - with provisions less than anticipated - so overall a positive trading outlook and our medium term buy rating is reiterated.
FRED LUCAS, J.P. MORGAN
As of yesterday's close and measured since 20 April, the Brent oil price has fallen 9 percent and BP has lost 36 percent or $68.3 billion of equity value. Adjusted for RD Shell's fall (-10 percent), BP's relative loss of market value is $50.2bn. Note that this exceeds our worst case liability estimate of $33.3 billion by more than 50 percent - so we still see a material value gap, even assuming an on-going incremental discount ... We retain our overweight recommendation on BP.
CHRISTIAN KLEINDIEST, UNICREDIT BANK
Although BP's results were strongly below expectations due to the extraordinary charges, we assume that the taken charges should provide a certain cushion for the costs of the oil spill. The announced asset disposals will change the shape of the whole group, but are less than perceived.
PETER BASSETT, WESTHOUSE SECURITIES
There are no surprises here, they've been trailed very heavily over the last few days, it's pretty in line with expectations. But the $32 billion right off, is slightly higher than people were going for.
CHRISTOPHE GAUTIER, FUND MANAGER AT GSD GESTION IN PARIS:
We thought about buying into the stock but we've decided to steer clear. One cannot tell what the eventual losses will be.
We prefer oil services companies to pure players such as BP.
DOUGIE YOUNGSON, ARBUTHNOT
It's no great surprise that Hayward has gone but what's encouraging is that he is staying within the business. I think it's quite shrewd them putting him in Russia given Bob Dudley's horrible relationship with TNK-BP.
I expected them to take a 20 billion charge this quarter but I guess what they're trying to do is get most of the bad news up front and out of the way. We should see a better second half.
Asset sales were two to three times bigger than we thought but it goes to show BP's going to be a substantially smaller company in the future.
PETER HITCHENS, PANMURE GORDON
It's basically a kitchen sink job and we've got the way forward.
They've taken all the charges at once and we're seeing the first way forward -- how they're going to deal with the balance sheet -- which is the key thing ... I think it's the board trying to wipe the slate clean.
(Reporting by Paul Hoskins, Rhys Jones, Sudip Kar-Gupta, Julie Crust and Lorraine Turner)