Russian state-run oil company Rosneft is in "advanced negotiations" to gain stakes in four German refineries by purchasing a 50 percent stake in Rurh Oel from Venezuela's state-run PdVSA, the Financial Times and the Wall Street Journal have reported. 

Bonhomie for Dudley, hints of a job for Hayward in Moscow

By John Bonar

"And now Mr Dudley is back!" Russia's energy czar, Deputy Prime Minister Igor Sechin exclaimed with a laugh when he met

BP Plc's new Chief Executive Robert Dudley and his predecessor Tony Hayward on Wednesday. The trio met in the Moscow headquarters of Rosneft, Russia's top  oil producer where Sechin is chairman. Despite the acrid smoke fog blanketing Moscow from peat fires smouldering in the surrounding region the three men appeared in good spirits and joked with each other.

The Return of the Prodigal Oilman

Asia’s markets are again following yesterday’s trend in the US markets. The MSCI Asia-Pacific Index is off 0.7% with the Nikkei down 2.2%. That is because the yen is higher (at 85.45 to the dollar) and investors are worried about the loss of export competitiveness. China equities are also lower; the CSI is off 0.9%, on fears of possible Central Bank tightening in the autumn. The dollar-euro rate is at $1.3212, slightly off from yesterday’s closing level of $1.3229, and gold is edging higher. It last traded at $1,195.1 per ounce. A small reaction to the nervousness about global growth that has come from the disappointing manufacturing reports this week. Copper if off 0.5% after yesterday’s 1.1% decline.

Buy BP Shares now

About six weeks ago Some Russian bankers I met wanted to know if they should buy BP shares. I urged caution as there was no waying of knowing how bad the situation was going to get for the company.

Today my advice is buy, buy, buy. The shares at 39% discount from their pre-Deepwater Horizon disaster high, are a bargain. The well appears to be capped, the relief wells are on time and on target and the company in a few short weeks will announce the sale of assets raising up to $20bn.

Hayward to reassure Medvedev

BP chief executive Tony Hayward is planning a trip to Russia to reassure President Dmitry Medvedev the oil giant is not on the verge of collapse, the Financial Times reported Monday. Hayward will meet with Medvedev and tell him that BP can meet the cost of the liabilities from the Gulf of Mexico oil spill, said the paper, without citing a source. The timing of the trip has not been finalised, it added.

Expressions of sympathy for BP from St Petersburg forum

Even while Andarco's exectives plotted to stab their partner BP in the back, the leaders of the global oil industry gathered as usual at Russia's top annual business forum this weekend and even although Tony Hayward, normally a regular, was conspicuous by his absence his company's woes were a constant topic of discussion among those who did come.

 

Time for Dudley to “kick ass”

Why BP had insisted up until now of fielding Tony Hayward, the boyishly charming CEO with a mop of curly hair as their front line of defense against the public tsunami of American hostility and criticism in the wake of the Maconda oil well explosion is beyond me. The Americans misunderstood Hayward’s flat Thames Valley vowels for privileged upper class. Well now they get one of their own to play with.

Perfect for the Gulf of Mexico disaster is Mississippian Robert Dudley, whom BP inherited from its merger with Amoco a decade ago. The BP Managing Director is used to playing hard ball as the former Chief Executive of the BP-TNK Russian joint venture where he was able to hone his management and negotiating skills with the likes of Mikhail Fridman (Alfa Group), Leonard Blavatnik (Access Industries) and Viktor Vekselberg (Renova) in a protracted dispute that ended with him resigning, 88 seconded BP employees being denied visas to Russia and TNK-BP starting to expand its operations outside the confines of Russia where BP would have liked to keep it.

The technical BP response is now in motion with 2/3 of the escaping oil now being captured, the relief wells advancing on the spill ahead of schedule, a (expensive) truce with President Barack Obama agreed and the US Congress stonewalled by a resolute Hayward now it is time for the tall Mississippian Dudley to "kick ass" to use that phrase coined by President Obama on June 8th.

In case you don’t know him, Dudley was that tall, light-haired fellow trailing behind BP Chairman, Carl-Henric Svanberg and Hayward after the White House meeting.

I predict Dudley’s first job will be to kick the ass of Anadarko Petroleum, the Texas oil company that owns 25 percent of BP’s Macondo oil field concession, into line.

The independent oil producer has just publicly slammed its partner as "reckless" and, in a statement, said "the mounting evidence clearly demonstrates that this tragedy was preventable."

It is a back-stabbing move by the Texan independent, which is the largest deepwater oil producer in the Gulf, clearly aimed at escaping contributing 25% to the $20bn compensation fund to which BP agreed to with President Obama.

Anadarco said, BP should be on the hook for 100 percent of the damages.

Anadarco said it was "shocked" to learn that BP operated unsafely and that it didn't monitor and react to warning signs as its Macondo well was drilled 41 miles off the coast of Louisiana.

Anadarko's position does not align with that of US Representative Edward Markey, who yesterday insisted that both the Texas company and Mitsui & Co., which owns a 10 percent stake in the gushing Gulf well, need to pony up some cash to help pay a share of claims.

"They cannot escape responsibility," Markey, speaking of BP's partners, told Bloomberg in an interview to be broadcast this weekend.

BP has agreed to fund a $20 billion escrow fund over four years to compensate victims of the disaster and to help pay for the clean-up costs.

Since the April 20 blowout Anadarko has kept quiet. It had its own men aboard the Deepwater Horizon and has had access to their on-site reports and de-briefing. The sudden pinpointing of blame onto BP when the investigations into the cause of the disaster are not yet complete is just a clear tactic to avoid contributing to the victim fund. Dudley should kick it into touch.