Gulf oil spill: BP could face ban as US launches criminal investigation

Last night announced that the U.S. initiate a criminal investigation into the Gulf of Mexico disaster disclosed by BP's worst day in a fiery six weeks ago Deepwater Horizon rig exploded and sank on 20 April, killing 11 workers.

Its shares fell 13% today, wiping £ 12 billion of its value when the financial markets reacted to news that oil is likely to continue spewing out into the Gulf of Mexico in less than two months. It was the worst day fall for 18 years for what was once Britain's most valuable company.

Political pressure is also increasing from the U.S., where BP's continuing failure to stop the leak has led to calls for Barack Obama to take a more harder approach and some commentators predict oil giant could an operating ban in the country.

Robert Reich, former labor secretary under Bill Clinton today called for BP's U.S. operations to be seized by the state until the leak was plugged. A group called Grip plan demonstrations in 50 cities in the U.S. and called for the company stripped of their belongings.

The stock subject to 15%, or $ 6.43, to close at $ 36.52 at the end of regular trading on the New York Stock Exchange.

The investigation announced by U.S. Attorney was launched just hours after Obama has promised to prosecute any parties found to have violated the law in the prelude to disaster. The president declined several threatening comments to a 10-minute address from the White House to mark the start of an independent commission to look at the causes of the explosion.

City experts advised clients to sell shares after BP's admission over the weekend that the much discussed "top kill" attempt to bung up the well was unsuccessful.

Dougie Youngson, oil analyst at Arbuthnot, said: "This situation has now gone far beyond the concerns that BP CEO Tony Hayward was fired, or shareholder dividend payments are cut - it's the real smell of death. This could break BP .

Given the collapse in share price and the potential for it to fall further, we expect that there may be a takeover target. "

BP is the largest oil producer in the Gulf of Mexico, and production growth plans for the next decade depends in part on finding new reserves in deep water.

BP said today that its costs from the disaster had risen to $ 990m (£ 675m).

Although it is impossible to quantify the full economic impact of the disaster, it seems to run into tens of billions of dollars and the costs will mount as long as the leak continues.

BP will try a more risky way to stop the leak this week, but this can result in the amount of oil rises, and the chances of success seem slim. It hopes to finish the game in two months when the first of two relief wells have been completed, but this operation could be hampered by the impending hurricane season.

Today Obama called the oil spill, the "biggest environmental disaster of its kind in our history" and said "if laws were broken, leading to this death and destruction is my solemn promise that we will bring these people to justice."

He added that for years the relationship between oil companies and their regulators have been "too nice" and said "we will take a comprehensive look at how oil and gas industry works."

Justice expected to lead a two-pronged strategy in the investigation of BP and other large entities are involved: Transocean and Halliburton.

One track will examine whether the company broke the rules in the days and months before the explosion, and the others to see if it violated any environmental laws.

So far Obama administration moved cautiously on the legal side of the oil disaster, knowledge of embarrassment for the issuance of a criminal case against a company that serves as the federal government remains deeply dependent on the closing out of the affected good and clean. But as political pressure has mounted, and Obama himself come under fire for being aggressive enough, the administration has shown a renewed willingness to take on BP.

The U.S. Justice Department will look for violations of the Water Act Endangered Species Act, Migratory Treaty and Law on the Oil Pollution Act 1990. Keeps saying "nothing is off the table at this time" with respect to the scale of charges prosecutors might work, including traditional prosecution if they find false statements were made.

"When we judge extended, we will be thorough, we will be comprehensive and we will be aggressive," is the press. "We will not rest until justice is done."

But he did acknowledge that the government's first priority was to stop gushing well and clean the oil.

As for BP, it has taken steps to strengthen the PR firm, in an attempt to limit the damage to his reputation. The company has hired as head of the firm's U.S. Media Relations Anne Womack Kolton, a former press secretary for Dick Cheney.