UPDATE: Kuwait Official Says Increasing Stake In BP A Bad Idea

6th Jul 2010 13:35

(Adds background.) By Tahani Karrar-Lewsley Of ZAWYA DOW JONES DUBAI (Zawya Dow Jones)--A member of Kuwait's top oil policy committee moved Tuesday to distance the Gulf country from increasing its stake in BP PLC (BP.LN) as speculation continues that Middle East investors a preparing to rescue the struggling U.K. company. "The investment authority in Kuwait already has a stake in BP and have lost a considerable amount on the book value," Imad Al Atiqi, a member of Kuwait's influential Supreme Petroleum Council, told Zawya Dow Jones by telephone. "This is sensitive for the authority and they need to keep the policy of diversification. It's not a matter of price and opportunity but a matter of diversification away from specific companies so I am not sure it's a good idea to raise the stake they already have in BP," Al Atiqi said. BP is battling one of the worst oil spill disasters in U.S. history since an explosion on the Transocean Ltd. (RIG) Deepwater Horizon drilling rig in the Gulf of Mexico--leased by BP for its Macondo well--on April 20. Local media have speculated over the last week that the company has been in talks with sovereign wealth investors in the Middle East to fend off a hostile takeover by one of its larger rivals. Al Atiqi's remarks come a day after Libya's top oil official Shokri Ghanem told Zawya Dow Jones that he would recommend to the Libyan Investment Authority, or LIA, the North African state's sovereign wealth fund, buying a stake in BP due to its low share price. The Supreme Petroleum Council is Kuwait's highest decision-making authority for the oil industry. Its members include the country's prime minister, oil minister and chief executive of state-owned Kuwait Petroleum Corp. On Monday, BP's shares marched higher, gaining 3.5% after Ghanem's remarks. Shares were up 2.22% Tuesday, trading at 340.7 pence at 1216 GMT. They closed at 655 pence on April 20. The oil giant's stock has risen 12% since hitting 14-year lows late last month, a sign that the shares are once again appealing to investors. -By Tahani Karrar-Lewsley, Dow Jones Newswires; +9714 446-1692; [email protected] Copyright (c) 2010 Dow Jones & Company, Inc. (END) Dow Jones Newswires July 06, 2010 08:35 ET (12:35 GMT)