BP chief relieved of daily control of spill crisis

BP's under-fire chief executive Tony Hayward has been relieved of day-to-day control of the Gulf of Mexico oil spill, the company's chairman has confirmed.

BP's under-fire chief executive Tony Hayward has been relieved of day-to-day control of the Gulf of Mexico oil spill, the company's chairman has confirmed.

Carl-Henric Svanberg also insisted the company was strong despite the "huge setback" of the Deepwater Horizon disaster.

BP managing director Bob Dudley will now take charge of the response to the spill, which has seen millions of gallons of oil continue to threaten the Gulf Coast. The firm had previously announced that Dudley would lead the long-term response once the leak had been stopped.

Latest estimates suggest 35,000 to 60,000 barrels a day are continuing to pour from the ruptured well. The Swedish chairman admitted the oil rig explosion, which left 11 people dead and an oil well ruptured, was a "tragic one" which "should never have happened".

Amid mounting anger in the US the company has set up a $20bn (£13bn) compensation fund and has scrapped shareholder dividends until the end of the year.

When asked about comments made by the president of Russia - a BP partner - Dmitry Medvedev about the possible "annihilation" of the company, Svanberg said: "No, I don't think so. I think we have to put everything in perspective, of course this is a huge thing, it is a huge setback for BP ... so of course the company is strong, the company has strong underlying performance, strong cash flow, strong operations."

BP suffered another blow after rating agency Moody's downgraded the firm's credit rating, citing the worsening impact of the oil spill, adding that the catastrophe will hurt BP's finances for years to come.

In an interview with Sky News Svanberg also defended Hayward who had endured a marathon grilling from US politicians and was accused of "stone-walling" and failing to adequately answer their questions.

"Now we are in an investigation and we are facing many, many trials and discussions of what went wrong and it would be wrong to go into those discussions before everything is on the table," said Svanberg.

Hayward also angered America and was forced to apologise when he put on his Facebook page that he "wanted my life back" following the explosion on 20 April.

The chairman said: "... It is clear that Tony has made remarks that have upset people, but he is also a man who has probably been on 100 hours of TV time and maybe 500."

He added: "America is frustrated, the fishermen, the people living on the Gulf Coast are frustrated and all the voices you hear, and you will hear those voices until we have done well there..."

Hayward has pledged that BP will foot the entire clean-up bill but has insisted it is "too early to say" what caused the massive spill.

There is a series of investigations by the US government and BP itself into the disaster which, said Svanberg: "... Will lead us to the questions, to the answers to the questions, what happened, why did it happen, what did BP do that we could have done differently, what could the industry do differently, what could the regulator do differently, the regulator, the environment, we will all draw conclusions but the focus now is to make sure that we close the well."

He added: "You must remember that BP is a very strong company with a strong asset base, strong operations, strong profitability and more than well capable of taking care of this situation."

See also: E&T's Deepwater Horizon timeline

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