BP chief executive Tony Hayward is being replaced over his handling of the Gulf of Mexico oil spill, a senior US government official said.
An official announcement could come today after a board meeting in London.
The official, who spoke on condition of anonymity, was briefed on the decision by a senior BP official late last week.
Mr Hayward, who took over as group chief executive in 2007, while BP was still reeling from the fall-out of a deadly Texas City blast, is reportedly trying to negotiate a compensation deal.
Bob Dudley, currently BP managing director, is tipped to be his successor.
BP could hold off announcing Mr Hayward’s departure – after a handover period – until the Macondo well, which has been sealed with a temporary cap, has been shut for good.
A spokesman for BP insisted that the chief executive continued to have the full support of the board and senior management and the company would not comment on “speculation”.
Industry body Oil and Gas UK refused to comment.
BP is due to release first-half results tomorrow and these are expected to show just how badly the firm has been hit by the oil spill. It is believed the massive compensation and clean-up costs associated with the slick are likely to have plunged the company into the red for the first time since 1992.
Mr Hayward, 53, has been repeatedly singled out for attack over his handling of the disaster, which began when the Deepwater Horizon rig exploded and sank, killing 11 workers, on April 20.
Last month, he faced a barrage of criticism in front of a fired-up Senate committee in Washington.
During a lengthy grilling from US politicians he was accused of presiding over “astonishing” corporate complacency.
He has made several gaffes, most notably wishing to have his “life back” and going to a yacht race off Britain while oil washed up on Gulf shores.
It will become clear in the coming days if he is to face a second bruising encounter on Capitol Hill.
The US Senate foreign relations committee wants him – alongside UK politicians – to answer questions about BP’s alleged role in lobbying for the release of Lockerbie bomber Abdelbaset al Megrahi.
A BP spokesman said yesterday the firm “will respond” to requests from the committee and “offer someone”.
There was better news yesterday regarding the actual clean-up operation.
A storm that forced relief workers to evacuate the site on Friday fizzled out, allowing ships to begin returning.
Engineers are hoping the clear weather will last long enough for them to finish work on the relief wells. Mud and cement will then be pumped into the broken well through the relief tunnels to try to permanently seal the outlet. It is hoped that the operation can be completed by mid-August. But that plan could be further disrupted by poor weather, with the hurricane season continuing until November 30.
Meanwhile, swindlers are reportedly flocking to the US Gulf coast in the hope of getting a share of the £13billion set aside to compensate people for spill-related losses. BP has paid £130million from the fund but, of the 114,000 claims submitted, the firm says nearly 54% lack key documentation.
According to the manager at the BP claims office in Boothville, Louisiana, one applicant was overheard saying she was a stripper in New Orleans.