Ever since the Deepwater Horizon oil spill, BP has tried to push off part of the blame for this tragedy on Transocean, the company that operated the rig. However, earlier today Transocean wasabsolved from having to pay actual damages for the spill.
A U.S. federal judge on Thursday said BP must uphold a clause in its contract with Transocean Ltd that would shield the Swiss-based driller from compensatory damage claims related to the 2010 disaster.
That means London-based BP may have to shoulder alone compensation claims brought by the likes of fishermen and hoteliers whose livelihoods were affected by largest offshore oil spill in U.S. history.
Transocean isn't quite out of the woods yet. The judge ruled that Transocean is potentially still on the hook for punitive damages and/or civil penalties. Still, this ruling means BP could potentially have to shoulder the entire cleanup bill even if Transocean is found to have acted with gross negligence--which at present is at over $42 billion.
Apparently the market thinks that this decision is a win for Transocean, if it can be called that. Analysts for UBS say the ruling significantly diminishes Transocean's liability. Transocean stock rose in the wake of the ruling, while BP's stock fell.