As prospects before BP get darker by the day, and the likelihood of bankruptcy grows, the TBTF propaganda begins. Evidence A – Bloomberg headline: “BP Demise Would Threaten U.S. Energy Security, Industry.” Just as the failure of bankrupt banks was supposed to lead to the destruction of capitalism, so the bankruptcy of BP plc is now supposed to lead to the degeneration of US energy independence. And who in their mind would force the Chapter 11 of a systemically important company? Once again, free market capitalism is about to walk out through the back door…
The company’s demise would be disruptive to the American oil industry, given that BP is the largest oil and gas producer in the U.S., with about 1 million barrels per day of production. Some 7,000 of BP’s 23,000 U.S. employees work in the Houston area, many in a suburban office park just off the Katy Freeway.
From there the company runs its Gulf of Mexico offshore operations with a phalanx of engineers, geologists, and computer scientists. “These are highly compensated people,” says J. Robinson West, chairman of Washington-based consultants PFC Energy. (more…)