Obama summons adds to BP's woes

Federal authorities in the US have given permission for the new effort that involves pumping oil from the busted wellhead to a special ship on the surface, where it will be burned off rather than collected.

The British oil giant hopes to trap as much as 2.2 million gallons of oil daily by the end of the month as it deploys additional containment equipment.

The plan was unveiled after the federal government pressed BP to work faster on containing the gusher and came as the President paid his fourth visit to the stricken Gulf and promised residents life would return to normal after the worst oil spill in US history.

BP suffered a further blow yesterday after a ratings agency slashed its debt to near-junk status amid fears over the catastrophic impact of the Gulf of Mexico spill. Fitch's second downgrade for the under-fire firm in less than two weeks leaves the blue-chip stock rated at BBB, its lowest investment grade.

Adding still further to the company's woes, BP shares,

which have lost almost half of their value since the Deepwater Horizon explosion in April, fell another 4 per cent to 342p yesterday.

Earlier, scientists said far more oil was spewing into the Gulf than first thought and US politicians called on the company to place up to $20 billion (13.5 billion) into a special account to deal with damage claims.

Fitch said the company's estimate of clean-up and claims had soared to up to six billion dollars (4.1 billion), while the agency said fines could be as high as eight billion dollars (5.4 billion). The cut to BBB will raise the cost of the firm's borrowing as investors demand higher returns for the increased risk.

Chief executive Tony Hayward, who is expected to be among the company executives meeting the US President today to discuss the disaster, has insisted BP is strong enough to weather the storm but Fitch said the increased risk of early claim payments would put pressure on the company and hamper access to capital markets.

The crisis began two months ago when the Deepwater Horizon rig exploded and sank with the loss of 11 lives.

Mr Obama returned to the stricken region on Monday, visiting Mississippi and Alabama. He sought to assure residents – and the country – that the government will "leave the Gulf Coast in better shape than it was before".

While the President was in the Gulf, congressional investigators released documents showing BP made a series of money-saving shortcuts and blunders that dramatically increased the danger of a destructive spill from a well that an engineer ominously described as a "nightmare" just six days before the April blowout.

Investigators found BP was badly behind schedule on the project and losing hundreds of thousands of pounds a day, and responded by cutting corners in the well design, cementing and drilling efforts and the installation of key safety devices.

Firms unprepared for another spill, congressmen claim

Two US congressmen reviewing contingency plans of five major oil companies in the event of another spill say they are nearly identical – and are all unprepared.

Representative Ed Markey, chairman of the energy and commerce environment subcommittee, said the plans "cite identical response capabilities and tout identical, ineffective equipment".

The committee looked at the plans of BP along with those of ExxonMobil, Chevron, ConocoPhillips and Shell Oil.

Mr Markey said at a hearing two plans list the phone number for the same dead expert, and three include references to protecting walruses – which do not even live in the Gulf.

Committee chairman Henry Waxman called them "cookie cutter plans".