BP shares rally as company considers sell off Go compare with our comparison table

BP shares rally as company considers sell off

02 July 2010 / by Lois Avery

BP shares are maintaining their popularity among investors, despite the company entering into talks to sell billions of pounds worth of assets.

The oil giant has been forced to sell nearly £6billion worth of assets, including its energy interests in South America.

It is hoped that the sell off will help raise vital funds to enable the company to pay for the clean up operation, of which £13billion will be needed for compensation claims.

The move follows mounting pressure from US politicians, including President Barak Obama, who have criticised the company for not doing enough to contain the damage caused by the explosion, which happened in April, at the Deepwater Horizon rig in the Gulf of Mexico.

However, despite the company's financial position, shares are proving popular among investors, who are taking advantage of their weak price.

Paul Inkster, head of product for Barclays Stockbrokers, said: "As BP continues to dominate the headlines, Barclays Stockbrokers' clients have been taking advantage of its share price fluctuations and trading the stock actively.”

“On Friday 25 June, when the share price fell from 324p to 296p, BP accounted for 22.71% of all buy trades executed by Barclays Stockbrokers' clients over the course of the day.”

On Wednesday the share price rallied significantly again, moving above 330p. Sales of BP shares, as a proportion of total sell trades, increased from 4.92 per cent on Tuesday, to 9.93 per cent on Wednesday.

And Shares in BP rose six per cent yesterday after suggestions that the operation to cap the oil leak could soon reach a successful conclusion.

Speaking to the Telegraph Fadel Gheit, oil analyst with Oppenheimer & Co, said: "The perception is that the relief well is ahead of schedule and should be successful by the end of this month.”

 "I believe it is a smart strategy for BP to raise extra money from banks at this time. They have enough liquidity on the balance sheet and may pay more but it's always better to have more money than you need."

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