Business

BP shares fall sharply on new seepage fears

Shares in BP have closed down nearly 5% in London amid uncertainty over the success of its latest attempts to stop the Gulf of Mexico oil leak.

Earlier Thad Allen, the US official overseeing the oil clean-up, warned that BP may have to remove the cap on its damaged oil well.

There are concerns that the cap is failing to prevent some oil leakage.

BP's shares ended the day at 389p, having risen from the 296p low reached at the end of June.

But the share price is still less than 60% of its level before the disaster began in April.

BP successfully fitted a cap to its damaged oil well on Friday, but Admiral Allen has expressed concern that methane gas and oil could be leaking elsewhere on the sea bed.

If that is found to be the case, the cap may have to be removed, though BP has been told it can keep the cap in place for at least the next 24 hours.

Today's falls have halted a recent recovery in BP's share price.

Investors have been encouraged by BP's progress and the increasing prospects of a takeover by a rival oil company or the significant investment of fresh funds, possibly from Middle East investors.

BP has put the costs of dealing with the disaster at over $3.95bn (£2.6bn).

It has already paid out more than $200m to 32,000 claimants.

The company is evaluating a further 17,000 for payment and is seeking more information on 61,000 other claims.