talked just minutes before the blowout about pressure problems in the well.

At first, nobody seemed too worried, workers have said. Then panic set in.

Workers called their bosses to report that the well was "coming in" and that they were "getting mud back." The drilling supervisor, Jason Anderson, tried to shut down the well.

It didn't work. At least two explosions turned the rig into an inferno.

In its report, BP defended the well's design, which has been criticized by industry experts.

Other findings in the BP report include:

• Flammable fluids rising up the pipe toward the Deepwater Horizon rig were directed to a system that allowed gas to vent onto the rig, and that gas was then circulated by the air conditioning, heating and ventilation systems. BP says that if the crew had directed the fluids overboard, there might have been more time to respond to the pending disaster and the consequences of the accident may have been reduced.
• BP concluded that a "more thorough review and testing by Halliburton" and "stronger quality assurance" by BP's well team well might have identified potential flaws and weaknesses in the design for the cement job.
• BP counters the concerns that were raised prior to the explosion by Halliburton over the potential for a severe gas flow problem if a BP plan was used. Halliburton and BP were at odds over a key device, known as a centralizer, that is used as part of the process to plug a deepwater well like the oil giant was doing at the time of the disaster. Halliburton's well design expert testified previously he told BP officials April 15 — five days before the well blew — that fewer centralizers would cause a bigger gas flow problem. BP rejected Halliburton's recommendation to use 21 centralizers. Instead, BP used six. In its report Wednesday, BP said the decision likely did not contribute to the cement's failure.

In June, the House Committee on Energy and Commerce's chairmen said it was BP that made five crucial decisions before the Deepwater Horizon well blowout that "posed a trade-off between cost and well safety." One of those decisions: BP opted against conducting a certain kind of test of the integrity of a cement job at the well. The test would have cost more than $128,000 and taken 9 to 12 hours to perform, the committee's letter notes.

In May, senior BP drilling engineer Mark Hafle told the Coast Guard and Bureau of Ocean Energy Management investigators that BP didn't order the test even though more than 3,000 barrels of mud had been lost while drilling, a possible warning sign.

The committee also criticized BP's well design.

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Associated Press Writers Curt Anderson in Miami, Chris Kahn in New York and Seth Borenstein in Washington contributed to this report.

BP shares gain after Gulf report

Shares in BP PLC tracked slightly higher after the release of an internal report on the disastrous oil spill in the Gulf of Mexico that deflects much of the blame onto rig owner Transocean Ltd. and contractor Halliburton Co.

The stock bounced as high as 416.4 pence ($6.44) after the report was made public Wednesday, before retreating a little to trade up 1.8 percent at 413.95 pence in early afternoon trading London time.

BP took some of the blame for April 20 explosion on the Deepwater Horizon rig that killed 11 workers and started the worst oil spill in U.S. history. It acknowledged in the report that its own employees misinterpreted a safety test that should have raised a red flag about a potential blowout of the Macondo well.

But — as widely expected — it also pointed the finger at other companies, including Transocean, saying the company's rig crew failed to recognise and act on danger signals that led to the accident. U.S. company Halliburton was criticized for errors in its cementing of the busted well.

"It is evident that a series of complex events, rather than a single mistake or failure, led to the tragedy," said outgoing Chief Executive Tony Hayward. "Multiple parties, including BP, Halliburton and Transocean, were involved."

Analysts said that successfully shifting the focus of culpability toward Transocean and Halliburton will help erode fears that BP will be found guilty of gross criminal negligence — and the heavy financial penalties that would entail.

Holly Pattenden, the head of oil and gas analysis at Business Monitor International, said that meant it was likely the company was well-placed to cover other litigation — hundreds of lawsuits have been filed over the oil spill.

"It will all depend on whether BP is found to be criminally negligent of its operation of the well," said Pattenden. "The report today suggests that they weren't and the problem can be shared across the different companies that were involved."

BP has set aside $32.2 billion to cover the long-term costs of the spill and is targeting $30 billion in asset sales over the next 18 months to shore up funds — it has already confirmed about $10 billion of those.

A decision by London-based Fitch Ratings

agency ahead of the release of the report to upgrade BP to an 'A' rating from 'BBB' added to the positive sentiment.

Fitch said its upgrade reflected an end to the threat of further leaks from the Macondo well, the improved visibility of potential liability scenarios the company could still face and substantial progress made in raising cash to meet those potential costs.

BP has increased its committed standby credit lines to around $17 billion from $5 billion and has announced $10 billion of a planned $30 billion in asset sales over the next 18 months.

"Fitch notes that BP's liquidity trebled since June following dramatic short-term progress on asset disposals," the ratings agency said, adding its outlook for the company was "stable."

"BP's credit metrics remain robust, and the company does not necessarily need additional borrowings to meet anticipated liabilities given cash inflow provided from asset sales and organic cash flow generation in the current oil price environment," it added.