Investors piled back into BP stock this morning as the City of London gambled after the Mexican Gulf oil disaster left shares at a bargain price.
Shares in BP opened 5% up at 385p, despite the continuing threat that the company may be forced to cut or suspend its dividend, and the announcement of a new, dramatically higher calculation of the amount of oil spilt into the Gulf of Mexico from the fractured Deepwater Horizon oil rig.
“Big institutional pension funds saw yesterday’s price drop [to as low as 352p] as a watershed level at which they would buy,” one City trader told The Times newspaper.
He also added that the oil giant’s stock would remain volatile as long as there was uncertainty surrounding the progress of the clean-up.
BP, once the UK’s largest company, has lost almost half of its stockmarket value, about £56bn, since the explosion on the rig in April, reports The Times.