Taxpayers may have to bail out BP if Gulf crisis sinks oil firm



Taxpayers could end up bailing out BP in the wake of the Gulf of Mexico oil spill disaster.

The Government is understood to be working on contingency plans in case the firm collapses.

In extreme circumstances, this could involve rescuing the business in a similar way to the bail-out of RBS during the credit crunch.

Ministers are concerned about the effect of a BP collapse on British pensioners, whose retirement income relies on the value of the company's shares.



Gulf disaster: The Deepwater Horizon explosion and the ensuing oil spill at the Gulf of Mexico

BP accounts for £1 out of every £7 paid out in dividends to British pension pots - but since the accident on April 20, its value has halved.

There are growing fears the company could be broken up or taken over, with unknown consequences for pensioners.

It is understood talks are being led by officials at the Treasury and the Department for Business about what to do if BP, which has liabilities of £46billion, falls apart.

On Sunday, BP announced it was going to sell £6billion in shares to raise capital following the oil spill. It was also reported Libya could be interested in buying some of the shares.

Neither the Business Department nor the Treasury would comment.