Shares of BP PLC rose Tuesday as the company endured sharp criticism from lawmakers in Washington and said it was speeding up payment of large commercial losses due to the oil spill in the Gulf of Mexico.
The shares turned higher at midday and closed up 73 cents, or 2.4 percent, at $31.40 in New York after peaking at $32.13.
At least temporarily, that stemmed a losing trend for the shares, which have fallen by nearly half since a BP-operated rig exploded and sank April 20, causing the biggest oil spill in U.S. history.
Investors shrugged off news that Fitch Ratings cut BP's long-term credit ratings to "BBB" from "AA," saying the company faced a greater risk that financial obligations will need to be paid sooner rather than later.
Lamar McKay, the president of BP's U.S. subsidiary, told the House Energy and Commerce Committee that the company will pay all legitimate claims for damages caused by the spill. But McKay wouldn't say whether BP supported putting money for claims into an escrow account.
BP said Tuesday it was speeding up payments for large commercial claims for damages from the spill and had approved initial payments for 90 percent of those claims. The company said it approved 337 payments totaling $16 million to businesses that have filed claims bigger than $5,000.
Executives of other oil companies, including Exxon Mobil, Shell, Chevron and ConocoPhillips distanced themselves from BP and criticized the company's operation in the Gulf.
"It would appear to me a number of design standards that I would consider to be the industry norm were not followed," said Exxon Mobil CEO Rex Tillerson. "We would not have drilled the way they did."
BP shares were helped by a rally in the broader market -- the Dow Jones industrial average was up about 2 percent by late afternoon -- and oil prices settled higher.
With a sell-off that has now lasted nearly two months, BP shares are cheap, said Oppenheimer & Co. analyst Fadel Gheit.
"The question is, how cheap?" Gheit said. "Should the stock trade at $32 if BP's liability is $10 billion? Should it trade at $1 if the liability is $100 billion? There is no way to know."
Investors are waiting to see what BP does about future dividends and how an escrow account with BP's money would be administered -- would it, for example, be run by government officials who would spend the kitty more freely than BP?
Answers could come as soon as this week. BP CEO Tony Hayward is scheduled to meet with President Barack Obama on Wednesday and testify before Congress on Thursday.
Exxon Mobil shares rose $1.14 to close at $62.51, Chevron gained $1.05 to close at $75.23, ConocoPhillips added $1.50, or 2.8 percent, to close at $54.30, and Royal Dutch Shell's American depositary receipts climbed $1.67, or 3.2 percent, to close at $54.05.