In the aftermath of the biggest environmental disaster in U.S. history, the Gulf of Mexico relief-well saga continues to monopolize our attention.
But here's the reality: Money problems - not the relief wells - could prove to be the undoing of BP PLC (NYSE ADR: BP). And that means the company's fate is most closely tied to its ongoing efforts to raise money by selling key assets from around the world.
BP is looking to divest $30 billion in assets during the next 18 months.Selling its assets is one way for the company to raise the money needed to cover its expected liabilities. But here's the problem: Those sales are moving right into the teeth of a new round of mergers-and-acquisitions (M&A) deals that were already taking place in the oil-and-gas sector, due to rising volatility there and the inability of some to withstand the uncertainty.
As a result of all this wheeling and dealing, the big will get bigger - and BP will get smaller. Indeed, the BP that emerges from the mess that it created should be smaller, leaner and smarter. But will that be good enough?
Tony Hayward
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Is BP Dealing Away Its Future?
To understand BP's financial strategy, please read on...
Special Report: New CEO Dudley Isn't the Long-Term Answer at BP, Expert Says
When readers ask me how Dr. Kent Moors could be up nearly 60% on a portfolio that he only launched July 6, I don't give them an answer.
I tell them a story.
When the BP PLC (NYSE ADR: BP) CEO-replacement saga began to unfold earlier this week, and the Money Morning news team was working the story, I contacted Dr. Moors to ask him if he knew anything about anointed successor Robert Dudley.
With that response, Dr. Moors underscored, yet again, why he's the ultimate energy-sector insider: He doesn't just know about Dudley - he actually knows him.
In fact, Dr. Moors went on to give me an analysis of the new CEO's managerial style, including Dudley's strengths and weaknesses. Dr. Moors even went as far as highlighting the elements of Dudley's managerial proclivities - and the elements of BP's strategy - that pose the biggest risks to the Big Oil company's turnaround.
For the full story on BP’s new CEO, please read on...
I tell them a story.
When the BP PLC (NYSE ADR: BP) CEO-replacement saga began to unfold earlier this week, and the Money Morning news team was working the story, I contacted Dr. Moors to ask him if he knew anything about anointed successor Robert Dudley.
With that response, Dr. Moors underscored, yet again, why he's the ultimate energy-sector insider: He doesn't just know about Dudley - he actually knows him.
In fact, Dr. Moors went on to give me an analysis of the new CEO's managerial style, including Dudley's strengths and weaknesses. Dr. Moors even went as far as highlighting the elements of Dudley's managerial proclivities - and the elements of BP's strategy - that pose the biggest risks to the Big Oil company's turnaround.
For the full story on BP’s new CEO, please read on...
Money Morning Mailbag: U.S. Drilling Ban Could Be Permanent for BP
The U.S. government's deepwater oil drilling ban, which resulted from the BP PLC (NYSE ADR: BP) Gulf oil spill, prompted some readers to question how far U.S. authority reaches regarding offshore business, and what kind of international repercussions could result.
Q: Where do international waters begin for the Gulf of Mexico? I read somewhere if we didn't drill for oil in the Gulf that China was going to do so. When you are talking international business, does U.S. President Barack Obama have the authority to shut it all down?
Q: Where do international waters begin for the Gulf of Mexico? I read somewhere if we didn't drill for oil in the Gulf that China was going to do so. When you are talking international business, does U.S. President Barack Obama have the authority to shut it all down?
- John M.