This is not investment advice, and I have no position in BP or energy. I can’t confirm the date, but I want to pass along what the telegraph mentioned (my bold):
The decision by Tony Hayward, BP’s chief executive, to slash costs earlier in the cycle than some of its rivals has borne fruit, although costs were only slightly lower in the first quarter because of currency effects. However, the $4bn in cash costs removed from the business in 2009 is helping operational performance….
This is below the 20pc to 30pc gearing range the company has targeted and investors can be confident that the dividend is secure. This means the shares are yielding almost 6pc, which is well worth having.
The first-quarter dividend of 14 cents will be paid on June 21. The corresponding amount in sterling will be announced on June 8, calculated from the average of the market exchange rates for the four dealing days prior to that.
New investors have until May 5 to buy the shares and qualify for the payment, and this is the eighth successive quarter that the dividend has been maintained at the same level.
It’s May 4th, so according to the article you have one more day to lock in new shares of BP stock to qualify for their fat, juicy June 21st dividend. If catastrophe capitalism of the 21st century is going to involve a lot of privatizing the gains of massive environmental degradation through big dividends while socializing the losses, psychologically it feels better if you can get some token amount of those dividends. In fact, it’s the 21st century neoliberal promise that we can all qualify to own token amounts of those dividends.
(Yes, I can hear the MM crowd saying that dividends don’t matter, but think of the signaling embedded in releasing a strong dividend right now.)
A few things:
– Ezra Klein did an interview with Lisa Margonelli, who notes that “we’re still using oil and its coming from other places. Some is coming from Canada and Norway and Mexico, and they have pretty good records. But on the whole, we’re going towards dicier and dicier places. The big pockets of oil are in places that are politically or geologically difficult to get to. Deepwater off Angola, drilling in Nigeria, the Exxon project in Chad.”
Those of you who are interested in such things might like to take this moment to visit James Ferguson’s short paper: “Seeing Like an Oil Company: Space, Security, and Global Capital in Neoliberal Africa.” In response to James Scott’s thought that large-scale globalizing capital’s agency might look similar to the agency of large-scale state action, an agency of homogenization, uniformity, and the gridlike simplification of space (a thought that the End of History crowd shares to a degree), Ferguson points out “today’s forms of capital investment in African mineral extraction have been noteworthy for their ability to bypass the nation-state frame altogether. Where national states are weak, collapsed, or configured in such a way that they thrive less on order than on disorder, many sorts of capital investment are thereby discouraged. But such conditions need not inhibit mineral extraction…Indeed, it is worth asking asking whether Africa’s combination of privately secured mineral-extraction enclaves and weakly governed humanitarian hinterlands might constitute not a lamentably immature form of globalization but, rather, a quite “advanced” and sophisticated mutation of it.”
– I remember several energy traders at a hedge fund I knew talking, years ago, about how surprised they were that BP was able to build an environmentally friendly reputation through sheer marketing alone. Kate Sheppard, who is presumably not an energy trader at a hedge fund, blows that myth up in a great article.
– I need to think more about this, but this does open my eyes to the idea of using aggregate GDP to capture the impact of environmental harm. In theory, GDP could go up from this accident.
– A peak into the Minerals Management Service, the division of the Interior Department responsible for offshore drilling, a farce under the Bush administration.
– This kind of argument might go quiet for a while, but take a look at how much the market applauded BP for “cutting costs.” Doing a google search down memory lane finds all kinds of applause for how ruthless BP was with cutting costs – it seems like it was the best thing they could be doing at any given moment.
For instance, “The City has been impressed with Hayward’s cost cutting drive, which has resulted in 22,000 staff leaving the company in two years and $4bn in savings last year. Last month, the market value of the company overtook its closest rival, Shell, for the first time in more than three years.” They keep going. Giving such a focus on the short term, and such a focus on profit and shareholder value above all else, is it not surprising that extra spending on precautions won’t take place?