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Thursday: BP Says Leak Fix Is Close; Obama Takes Tour to Buffalo

Officials from BP said Wednesday they may be closer to stopping the underwater oil leak that has been gushing into the Gulf of Mexico for nearly a month. BP officials told the New York Times that engineers have drafted plans to begin repairs on the underwater blowout preventer that was meant to seal the oil well in the event of an emergency.

During a House hearing Wednesday, Rep. Bart Stupak, D-Mich., said initial investigations have revealed the “blowout preventer had a significant leak in a key hydraulic system.”

As the Associated Press reports this morning:

“The first firm evidence of what likely caused the disastrous Gulf of Mexico oil blowout — a devastating sequence of equipment failures — drives home a central unsettling point about America’s oil industry: key safety features at tens of thousands of U.S. offshore rigs are barely regulated.”

BP says its costs for the spill have topped $450 million.

Transocean, the owner and operator of the Deepwater Horizon rig, will file a petition on Thursday seeking to limit its liability for the spill to just under $27 million.

Meantime, the Obama administration is seeking to raise the cap on damages that the government can collect from oil companies during a spill. The cap is currently set at $75 million, though several key Democrats would like to see the amount rise to as much as $10 billion.

Obama Heads to Buffalo

President Barack Obama heads to Buffalo, New York, on Thursday for the latest stop on his White House to Main Street tour. The president’s visit will focus largely on the economy. He’ll tour a local manufacturing plant, where he’ll deliver remarks praising the administration’s progress on the economy.

Expect the president to defend the $787 billion stimulus package, highlighting the impact the legislation has had in the Buffalo region. According to Patchwork Nation, a NewsHour collaboration with the Christian Science Monitor, more than $425 million in stimulus funds have gone to Erie County, home to Buffalo.

The president will also use his visit to talk about jobs. The latest unemployment report showed employers added 290,000 jobs in April, the biggest gain in four years.

President Obama will urge Congress to pass new job creation measures and “call on Republicans to stop sitting on the sidelines and obstructing efforts to rebuild our economy for the sake of short-term political gain,” a White House official told Reuters.

Writing in the Buffalo News, Rep. Chris Lee, R-N.Y., says he hopes President Obama will use his visit “to listen — really listen — to what Western New Yorkers have to say,” particularly when it comes to the deficit. “Western New Yorkers live within their means,” he writes. “We hope the president will walk away from his visit understanding that the federal government must also live by those same principles.”

More Banks Investigated in Wall Street Probe

Federal prosecutors and the New York attorney general’s office are widening their probe of Wall Street banks in the run-up to the financial crisis. The New York Times reports, “The New York attorney general has started an investigation of eight banks to determine whether they provided misleading information to rating agencies in order to inflate the grades of certain mortgage securities.”

The banks under investigation are: Goldman Sachs, Morgan Stanley, UBS, Citigroup, Deutsche Bank, Credit Agricole and Merrill Lynch.

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