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BP loses $17 billion, but is worst over as Robert Dudley takes reins?

BP earmarked $32.2 billion last quarter for current and future Gulf oil spill costs – leading to $17 billion in losses. Yet BP is cautiously optimistic with Robert Dudley set to take over in October.

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One is whether BP will be found to have exhibited "gross negligence" in operating the Deepwater Horizon rig before its April explosion. That would push up the federal fines per barrel spilled. Similarly, legal liabilities in class-action lawsuits are uncertain. It's also unclear whether firms that were BP partners on the rig will have to pay a share of ultimate tab for the spill.

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In TV interviews Tuesday, BP Chairman Carl-Henric Svanberg acknowledged these uncertainties. The company said in its news release that legal costs will be spread out over years. And it's too soon to say that the environmental damage from the spill has been contained. That will be an ongoing effort that could cost billions of dollars in coming months.

Still, for the finances of BP, it's possible that the second quarter will represent a turning point. But only time will tell whether that's the case.

"With the leak now capped we have reached a significant milestone,” Mr. Hawyard said in the earnings news release. “This provides a firm basis for moving forward to reshape the company."

BP's share price has climbed since late June, when it reached a post-spill low point. The stock now trades about 35 percent lower than it did just before the rig disaster, whereas in June the share price had plunged by more than 50 percent. A weak economy has pushed oil stocks in general down about 10 percent in that same time frame.

The spill has forced BP to make some drastic changes. It plans to sell up to $30 billion of its global assets (about 10 percent of its business holdings) to help pay the costs. And it has suspended its shareholder dividends, a move the company hopes to reinstate.

The company "remains strongly committed to the payment of future dividends," Mr. Svanberg said. "The Board will consider its position on future dividend payments ... in February 2011.”

IN PICTURES: Destructive Oil Spills