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Scott Kappes
Scott Kappes
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Analyst Says BP Doesn’t Expect Claims to Reach $20B Mark

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According to Citigroup analyst Mark Fletcher, BP believes that claims for compensation will not exceed the $20 billion the company has set aside to pay them.

Although BP did not confirm nor deny Fletcher’s statement, I am sure it ranks pretty high on their wish list.

In an internal investigation report published last week BP attempted to downplay their role in the events that lead up to the explosion of the Deepwater Horizon and what has now become the worst oil spill to ever affect the American coastline.

"A complex and interlinked series of mechanical failures, human judgments, engineering design, operational implementation and team interfaces came together to allow the initiation and escalation of the accident," the report said.

The spill has caused serious damage to the fragile ecosystems that line the Gulf coast and has played havoc on the multi-billion dollar Gulf fishing, shrimping, and tourism industries.

By law BP is required to compensate workers and business owners that have seen a loss of income due to the effects of the massive oil spill.

Hundreds of thousands of economic loss and property damage claims have already made against BP, but it is likely that the oil giant will face thousands more before all is said and done.

Gulf oil spill cleanup efforts will continue for years to come as workers attempt to restore vitality to the oil ravaged waters of the Gulf coast.

BP has lost almost half of their market value since the April 20th explosion and has even had to sell off some of its assets to cover cleanup costs.

Only time will tell what the true costs of the spill will be, but considering the thousands of lawsuits pending against the company, it may be little more than wishful thinking to keep claim payouts below the $20 billion threshold.