S&P downgrades BP's outlook

BP's outlook was revised to negative from stable by Standard & Poor's Ratings Services as the company faces uncertainty about the costs stemming from an oil spill at its Macondo well in the Gulf of Mexico.

The London-based oil company, which is the biggest oil and gas producer in the gulf, maintained its "AA" long-term and "A-1+" short-term corporate credit ratings, Standard & Poor's said in a note yesterday.

Standard & Poor's also lowered its outlook for Anadarko Petroleum, which owns a 25 per cent stake in the leaking well, due to its potential liability for costs related to the spill.

It might take several years to determine costs and liabilities associated with the spill, Patrick Jeffrey and Lawrence Wilkinson, credit analysts with Standard & Poor's, wrote in their note about Anadarko, based in Texas.

Costs related to cleaning up the oil spilling from the well about 64km off the coast of Louisiana might cut BP's financial flexibility, which was already limited at the rating level, Simon Redmond and Per Karlsson, credit analysts at Standard & Poor's, wrote in the note about BP.

They said it was still too early to estimate with any degree of confidence the full future impact on BP from the spill.

- BLOOMBERG