BP PLC, London, expects to contribute $500 million to $700 million to its U.S. pension plans this year to offset a 62% funding deficit. "We dont know how much exactly is going to be needed; we will be speaking to the actuaries about this during the year, said a BP spokesman. The companys long-term rate-of-return assumption for the U.S. plans is 8%, including 11% for equities, 7% for bonds and 8% for real estate. The companys annual report, released today, estimated a one-percentage-point deviation from the assumption could mean an additional $240 million in pension costs this year.
BPs U.S. schemes had assets of $4.2 billion and liabilities of $6.8 billion as of Dec. 31; its U.K. schemes had $15.1 billion in assets and $14.8 billion in liabilities.