Biz Brief: BP Dividend Controversy Straining Trans-Atlantic Relations


The controversy over whether BP (BP) should pay out a dividend to its shareholders is taking on a political life of its own. BP and its post-spill future are expected to be on the agenda this weekend, when British Prime Minister David Cameron and President Barack Obama talk by telephone.

On Wednesday, Democratic senators Chuck Schumer of New York and Ron Wyden of Oregon called on BP to put off any planned shareholder dividends until the total cost of the BP oil spill and cleanup in the Gulf of Mexico has been tallied. Mounting criticism of BP, meanwhile, hasn't gone unnoticed in the UK. Sir Christopher Meyer, the former British ambassador to the US, told the BBC the issue had become "a bit of a crisis, politically" for UK/U.S. relations.

UK pension investors, meanwhile, are quite worried. "BP is an enormously important stock for British Pension Funds," says the UK group FairPensions, "and with BP under pressure to scrap its next quarterly dividend and facing the possibility of a takeover if the share price continues to fall, there is real concern for the impact on people's retirement savings."