David Cameron was under mounting pressure last night to stand up for British interests and stop BP being 'thrown to the wolves'.

The Prime Minister caused dismay by appearing to side with President Obama as another £5billion was wiped off the value of BP shares in the escalating row over the Gulf of Mexico oil spill.

In his first response to the crisis, Mr Cameron failed to back demands from other senior Tories, including London Mayor Boris Johnson, for an end to 'anti-British rhetoric, buckpassing and name-calling' by the U.S.

   

Since the accident on April 20, BP  -  which accounts for £1 in every £7 paid out in dividends to British pension pots  -  has lost £55billion from its stock market value.
 
The continuing fall threatens the wider economy because most British insurance companies, building societies and pension funds have large holdings of the firm's shares.

Speaking in Kabul, where he is visiting British troops, the Prime Minister declared: 'I completely understand the U.S. government's frustration because it's catastrophic for the environment.'

But he failed to express his explicit support for the crisis-torn British oil giant and hours later Chancellor George Osborne attempted to calm the row by insisting Mr Cameron was well aware of the 'economic value BP brings to people in Britain and America'.

Last night, as Britain and the U.S. stood on the brink of a major diplomatic crisis:
One of Britain's leading businessmen wrote an extraordinary open letter to President Obama attacking his 'prejudicial and personal' stance against BP;

Experts said the failure to stem the damage from the spill had left the beleaguered firm vulnerable to a takeover or even 'Chapter 11' bankruptcy in America;

Downing Street said Mr Cameron will speak to President Obama about the disaster for the first time this weekend, as it emerged that the pair have not spoken formally since a congratulatory call on the day the Tory PM entered No 10;

A BP petrol station came under attack in the U.S. as calls for a boycott of its forecourts gathered pace;

Fears grew that BP is considering scrapping payouts to shareholders to appease American anger, hitting millions of pensions in Britain.
 
Until now, the Government has attempted to keep its distance from the row caused by the massive oil leak following an explosion on a platform in the Gulf of Mexico.

But amid growing warnings from business leaders and MPs that the White House's rhetoric is fuelling a collapse in confidence in the company's future, Mr Cameron has now been dragged to the heart of the affair.

Asked if he intended to raise the issue with President Obama, he said: 'I'm sure BP and what's happened on the Gulf coast will be something we will discuss.
 
'I completely understand the U.S. government's frustration because it's an environmental catastrophe. The most important thing is to mitigate the effects of the leak and get to the root of the problem.'

President Obama's vituperative remarks about BP - and his administration's insistence on calling it 'British Petroleum', a name it ditched a decade ago - are causing increasing anger.

He has said he is looking for 'XXXto kick' at BP, and that he would have sacked the firm's chief executive Tony Hayward.

 Last night a U.S. State Department spokesman said he had no knowledge whether anyone in the British government had voiced a complaint directly to the Obama administration.
 
He added: 'I don't see it as a source of tension. BP is a private company and this is about the impact of a tragedy in terms of the explosion of the oil platform and the resulting oil spill. This is not about relations between the United States and its closest ally.'

But the U.S. administration has caused astonishment by threatening to block BP paying dividends to shareholders to ensure victims of the spill off the coast of Louisiana get adequate compensation.

President Obama's Interior Secretary Ken Salazar is even suggesting BP should compensate other oil firms for losses if they have to lay off workers or suffer economically because of the administration's six-month moratorium on deepwater drilling.

Lord [Digby] Jones, the former trade minister, said Mr Cameron should 'take the argument back to America'.

'I would expect him to stand up more for a British company,' he said.

'I would look to hear David Cameron say: "You've got some other people to shoulder the blame here, and they happen to be Americans".

'Obama is saying to himself: "How can I distance myself from this problem?" His answer is to throw BP to the wolves.'

John Napier, chairman of Royal Sun Alliance - one of the City's biggest insurers - published an open letter to President Obama accusing him of being grossly unfair.

In a brutal attack, Mr Napier said: 'There is a sense here that these attacks are being made because BP is British.' It goes on to accuse Mr Obama of 'double standards', who should be reminded of the damage which American banks have wreaked on the global financial system.

And London Mayor Boris Johnson said: 'I would like to see a bit of cool heads rather than endlessly buck-passing and name-calling.'

It emerged last night that BP is considering bowing to President Obama's demand to scrap its dividend payout to shareholders. It is understood the oil giant would proceed with such a move only if it could strike a deal whereby the U.S. would tone down its relentless attacks.

For British investors, particularly pension funds, the move would be a disaster. Last year's dividend was worth around £7 billion, and it accounts for about £1 in every £7 paid out by companies in the FTSE 100.

Pensions Minister Lord Freud suggested pension funds may be to blame for investing too heavily in one company.

In a House of Lords debate, Lord Freud said that of all the dividends paid last year by FTSE 100 companies, BP was responsible for around 14 per cent.

He said: 'This raises the question...To what extent are pension funds acting responsibly with regard to their ownership responsibilities to companies?'
 
Stop the anti-British bias, say City chiefsBy Becky Barrow and Karl West
One of the biggest names in business yesterday led a City backlash against President Obama's critical treatment of BP.

The intervention came from John Napier, chairman of one of the country's biggest insurers Royal Sun Alliance.

 He was backed up by former trade minister Lord Jones who insisted: 'Obama is saying to himself "How can I distance myself from this problem?". His answer is to throw BP to the wolves.'

Yesterday Mr Napier, 67, published an open letter to Barack Obama accusing the President of being grossly unfair in his approach to the embattled oil company.

He wrote: 'There is a sense here these attacks are being made because BP is British.'

The letter goes on to accused Mr Obama of 'double standards' after the damage which American banks caused on the global financial system. Mr Napier also accuses Obama of being 'somewhat prejudicial and personal' towards BP's boss Tony Hayward.

He writes: 'The immediate issues are very challenging but are best solved together in a more statesmanlike way. The leak may take time to fix, and it will be, but Afghanistan and Iraq will take much longer.

'We can all agree that the first and absolute priority is to stem the leak. Perhaps the second one is to ensure the reputation of the Presidency outside the U.S.A is seen as objective, balanced, able and capable of taking the heat when under pressure.

'We liked the Obama we saw at your election. Can we have more of it, please?'
Last night, RSA insisted Mr Napier's comments were made in a personal capacity.

But asked on Sky News why he had 'taken a pop' at President Obama, Mr Napier said: 'Have I had a pop at him? Not at all. I've just put on record my concerns about the tone that has developed, particularly about the personalisation of issues which is alien to us and our culture and the fact that it's being received over here as an anti British rhetoric.'