Tony’s travels: antsy Russians, rich Saudis, and furious investors

It’s been almost three weeks since BP pulled its not-so-press-savvy CEO, Tony Hayward, off the Gulf oil spill. What’s he been up to since? Trying to keep his company together, more or less. In his new role as BP’s globetrotting diplomat, Hayward has turned up in Moscow and Baku — both pillars of BP’s asset ...

CHRIS KLEPONIS/AFP/Getty Images
CHRIS KLEPONIS/AFP/Getty Images
CHRIS KLEPONIS/AFP/Getty Images

It's been almost three weeks since BP pulled its not-so-press-savvy CEO, Tony Hayward, off the Gulf oil spill. What's he been up to since? Trying to keep his company together, more or less. In his new role as BP's globetrotting diplomat, Hayward has turned up in Moscow and Baku -- both pillars of BP's asset base -- in an effort to assuage shareholders that the company will survive its current cataclysm more or less intact. The Baku properties appear to be safe, but not necessarily BP's Russian reserves, which could be in jeopardy should BP's oligarch partners decide to strike.

Now Hayward's in the Persian Gulf, visiting Abu Dhabi -- home to one of the world's premier sovereign wealth funds -- yesterday, apparently to talk about a strategic investment in BP. The company has stressed that it is not going to issue new shares, but there are plenty of other shares to go around: in the company treasury, for instance, and in the hands of currently disgruntled shareholders. Yesterday, the Saudi business newspaper al-Eqtisadiyah reported that a group of unidentified investors from that country are interested in a 10 to 15 percent stake in BP.

Of course, as Ed Crooks reports bluntly in today's Financial Times, all of Hayward's efforts could be in vain if his U.S. colleagues fail to stanch the catastrophe in the Gulf. If the relief well doesn't work, Crooks writes, "the company may be doomed." BP hopes to cap the well before July 27, earlier than the August date the company had announced before, but the new target may have less to do with engineering ability than with corporate necessity. The 27th is the date of a conference call tied to BP's second-quarter earnings report, in which executives must answer to furious shareholders wondering how this could have happened, and just what it's all going to cost.

It’s been almost three weeks since BP pulled its not-so-press-savvy CEO, Tony Hayward, off the Gulf oil spill. What’s he been up to since? Trying to keep his company together, more or less. In his new role as BP’s globetrotting diplomat, Hayward has turned up in Moscow and Baku — both pillars of BP’s asset base — in an effort to assuage shareholders that the company will survive its current cataclysm more or less intact. The Baku properties appear to be safe, but not necessarily BP’s Russian reserves, which could be in jeopardy should BP’s oligarch partners decide to strike.

Now Hayward’s in the Persian Gulf, visiting Abu Dhabi — home to one of the world’s premier sovereign wealth funds — yesterday, apparently to talk about a strategic investment in BP. The company has stressed that it is not going to issue new shares, but there are plenty of other shares to go around: in the company treasury, for instance, and in the hands of currently disgruntled shareholders. Yesterday, the Saudi business newspaper al-Eqtisadiyah reported that a group of unidentified investors from that country are interested in a 10 to 15 percent stake in BP.

Of course, as Ed Crooks reports bluntly in today’s Financial Times, all of Hayward’s efforts could be in vain if his U.S. colleagues fail to stanch the catastrophe in the Gulf. If the relief well doesn’t work, Crooks writes, "the company may be doomed." BP hopes to cap the well before July 27, earlier than the August date the company had announced before, but the new target may have less to do with engineering ability than with corporate necessity. The 27th is the date of a conference call tied to BP’s second-quarter earnings report, in which executives must answer to furious shareholders wondering how this could have happened, and just what it’s all going to cost.

Barack Obama’s administration has much riding on BP’s success as well: The president’s slide in the polls has coincided with the out-of-control spill, and one of the administration’s bids to appear on top of the situation, a six-month moratorium on drilling in the Gulf, was blocked last month by a federal judge in New Orleans. Today, the administration will ask a three-judge panel to reinstate the moratorium while it appeals U.S. District Judge Martin L.C. Feldman’s injunction. (Loyola Law Professor Dane Ciolino, interviewed by Don Ames at WWL radio in New Orleans, has a good description of the stakes.)

But the administration is also woven into BP’s decision-making, as the Wall Street Journal‘s Monica Langley reports today. Energy Secretary Steven Chu has pushed the company to formulate a Plan C and Plan D should its current relief well strategy fail.

<p> Steve LeVine is a contributing editor at Foreign Policy, a Schwartz Fellow at the New America Foundation, and author of The Oil and the Glory. </p>

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