Oil giant BP yesterday said the cost of the Gulf of Mexico spill had hit $3.5 billion but added that its latest efforts to contain the disaster were on track.

The firm has engaged 46,000 staff and 6,400 ships so far in the clean-up effort since the Deepwater Horizon rig exploded and sank on April 20 and crude began spewing into the ocean.

The group said the installation of a new sealing cap over the leaking well - which is capable of collecting more than 50,000 barrels a day and is more resilient to the hurricane season - was "proceeding as planned". BP has gathered around 749,100 barrels of oil from the various containment systems in place around the well so far and is developing plans to increase collection capacity to up to 80,000 barrels of oil a day by the end of the month.

Investors in the oil giant, a staple of UK pension funds, have been alarmed by the fall in the share price since the spill but shares rose more than five per cent following the update.

BP is also on track with two relief wells being drilled below the seabed to intercept the leaking well at about 18,000 feet below sea-level and stem the flow of oil permanently. The first well should be completed during early August, when "kill" operations can begin. The group has paid out about $165 million in claims to 52,000 businesses so far, although the intense political pressure on the oil giant has eased since the group set aside a $20 billion compensation fund to meet the costs of the disaster in June.