The United States District Court for the Eastern District of Louisiana has found that a subsidiary of U.K.-based oil major BP PLC was grossly negligent with regard to the oil spill from the Macondo well in the Gulf of Mexico in April 2010. Although BP has said it will appeal the decision and the penalty has yet to be determined, we believe that the final payout is likely to be materially higher than we previously included in our base-case forecast. We are therefore revising the outlook on BP to stable from positive. We are affirming our 'A/A-1' corporate credit ratings on BP given the company's solid liquidity cushion and current strong operating performance, although rating headroom has significantly reduced. The
