BP spill throws Jupiter Ltd into disarray
Following the ongoing oil leak in the Gulf of Mexico, two insurance rating agencies have downgraded their ratings on BP’s Guernsey-based operation Jupiter Insurance Ltd.
As BP struggle to contain the spill and stem the negative impact on the company’s image, rating agency Standard & Poor’s has lowered its ratings of BP and Jupiter as the credit and financial well being of the oil giant remains up in the air.
Jupiter has been lowered from AA- to A in less than two weeks having previously been ranked as an AA company.
Standard & Poor explained its decisions following: “the challenges and uncertainties that BP continue to face due to the leaking Macondo well in the Gulf of Mexico.”
The downgrades are thought to be directly linked to the establishment of a $20bn BP claims fund for those affected by the Deepwater Horizon disaster.
AM Best is also thought to have slashed Jupiter’s rating from its previous A+ rating.
Jupiter has also been placed on CreditWatch while AM Best reiterated the feeling of uncertainty voiced by Standard & Poor by saying:
“It is currently impossible to assess the impact of the Deepwater Horizon spill on BP.”
