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BP shares in focus after US doubles spill estimate

Shares in British energy giant BP will be in the spotlight again on Friday after US government scientists doubled their estimate of the amount of oil gushing out of its ruptured Gulf of Mexico well.

business Updated: Jun 11, 2010 11:41 IST

Shares in British energy giant BP will be in the spotlight again on Friday after US government scientists doubled their estimate of the amount of oil gushing out of its ruptured Gulf of Mexico well.

The news that the flow rate may be as high 40,000 barrels (1.68 million gallons/6.36 million litres) per day came after US markets closed on Thursday.

BP shares closed 6.65 per cent down in London at 365.50 pence while in New York they rebounded from 14-year lows to end 12.3 per cent higher at $32.78.

The White House said on Thursday that President Barack Obama had invited BP Chairman Carl-Henric Svanberg to the White House next Wednesday to discuss the spill.

BP has come under increased pressure from the Obama administration in recent days and on Thursday British Prime Minister David Cameron said Britain stood ready to help the British company deal with the spill.

Speaking during a visit to Afghanistan, Cameron said he would take up the matter with Obama when they speak in the next few days. It was the first time Cameron made a public comment about the spill.

The spill, already the worst in US history, is much bigger than many had thought.

US scientists said on Thursday that between 20,000 and 40,000 barrels (840,000 and 1.7 million gallons/3.2 million and 6.4 million litres) of oil flowed from the well before June 3, when BP's remotely operated robots sawed through an underwater pipe to clear the way for a capping procedure.

U.S. Interior Secretary Ken Salazar told a congressional panel on Wednesday that the cut may have increased the rate by 4 to 5 per cent.

Based on a rate of 40,000 barrels per day, the stricken well could have spewed as much as 2 million barrels (84 million gallons/317 million of liters) of oil since it ruptured on April 20 -- eight times the amount that the Exxon Valdez spilled into Prince William Sound in Alaska in 1989.