Mr Obama used his first televised address from the Oval Office to accuse the company of recklessness and said he would order it to set up a fund to compensate victims and help the region's economy recover from America's worst ever environmental disaster.
The president was speaking ahead of a crucial meeting with BP chairman Carl-Henric Svanberg and other top BP executives at the White House later today.
It comes after a ratings agency slashed the beleaguered firm's debt to near-junk status yesterday after scientists said far more oil was spewing into the Gulf than previously thought and US politicians called on BP to place up to 20 billion US dollars (13.5 billion) into a special account to deal with damage claims.
Fitch's second downgrade for BP in less than two weeks leaves the blue-chip stock rated at BBB, the agency's lowest investment grade.
Fitch said the company's estimate of clean-up and claims had soared to up to six billion dollars (4.1 billion), while fines could be as high as eight billion dollars (5.4 billion).
Meanwhile long-term claims over the spill could drag on for years following the pattern of the Exxon Valdez spill, the ratings agency added.
The cut to BBB will raise the cost of the firm's borrowing as investors demand higher returns for the increased risk.
The firm's shares which have slumped by almost half since the crisis began two months ago when the Deepwater Horizon rig exploded and sank with the loss of 11 lives fell another four per cent to 342p yesterday.
Mr Obama summoned Mr Svanberg to the White House today to explain what the company is doing to stop the flow of tens of thousands of barrels of oil and how it will compensate the thousands of people impacted.
BP's chief executive Tony Hayward - who has taken the brunt of the criticism levied at the firm so far and made a series of press blunders - faces a stormy grilling in Congress tomorrow.
Shortly after Mr Obama's speech, BP released a statement saying it shared the president's goal of cleaning up the oil and wanted to help people affected by the spill.
The company said it hoped "for a constructive discussion about how best to achieve these mutual goals" at today's meeting.
Mr Obama said he had asked former Mississippi Governor Ray Mabus to develop a long-term Gulf Coast Restoration Plan - to be funded but not controlled by BP - together with local states, communities, fishermen, conservationists and residents.
He said: "We've directed BP to mobilise additional equipment and technology. And in the coming weeks and days, these efforts should capture up to 90 per cent of the oil leaking out of the well. This is until the company finishes drilling a relief well later in the summer that's expected to stop the leak completely.
"Already, this oil spill is the worst environmental disaster America has ever faced. And unlike an earthquake or a hurricane, it's not a single event that does its damage in a matter of minutes or days.
"The millions of gallons of oil that have spilled into the Gulf of Mexico are more like an epidemic, one that we will be fighting for months and even years.
"But make no mistake: We will fight this spill with everything we've got for as long as it takes. We will make BP pay for the damage their company has caused. And we will do whatever's necessary to help the Gulf Coast and its people recover from this tragedy."