At almost every step of the way, BP’s efforts to cap the well spewing oil into the Gulf have wound up making things worse. Let’s hope this doesn’t continue, but for now, we have an uncapped well putting at least 35,000 barrels and maybe as much as 100,000 into the water today (I don’t know why WaPo is foregrounding the 15,000 barrels the last containment dome was catching, implying that no more oil would flow). You can read BP’s entire plan for the next several weeks, both the new cap and the timeline for the relief wells, in this letter to Thad Allen.

While BP claims that the project is moving on schedule, they’ve said that before, and yet previous top hats, top kills and junk shots wound up failing or capturing an inadequate amount of oil to stop the leak. And if the well cannot be fully capped, the risk of an increased flow into the Gulf exists. Remember that every barrel of oil carries with it not only a human cost in pollution, but a hard financial cost in per-barrel fines and penalties. I’ve been saying for a month that BP stands at risk of bankruptcy, and the New York Times picks it up today.

With pockets as deep as BP’s — its assets are worth more than $260 billion — the possibility that it might be forced to seek bankruptcy protection because of the Gulf of Mexico oil spill is considered remote by many industry experts.

But what if the company’s plan to contain the spill in the next several days does not work, and other efforts to stop the gushing oil also fail? If that were to occur, the worst-case projections of some experts, if they came to pass, would strain the ability of any company to pay, said Robin K. Craig, associate dean for environmental programs at the Florida State University College of Law.

Professor Craig said that if the oil hit the Gulf Stream and was carried by currents to East Coast states, Cuba and other Caribbean nations, and possibly even Britain, lawsuits could quickly mount to levels even BP could not handle.

“My bet is that BP will finally go bankrupt from the tort liability and the environmental liability,” she said. “Hypothetically, a bluefin tuna farmer in the Mediterranean could end up with a claim against BP.”

This becomes particularly true if Eric Holder does pursue legitimate criminal charges. Holder has said that his wide-ranging investigation would cover more companies than BP, but obviously they would be at the center of any investigation. And those other companies have already begun to stiff BP, which will result in additional legal proceedings (Anadarko may even have a case that BP holds all the negligence in this case).

I know that BP has $260 billion in assets, and makes enough in a day to cover the entire $75 million liability cap (which doesn’t include criminal penalties). But this possibility is real. A lot of things would have to go wrong, but a lot have already. And while the executives at BP would probably emerge from bankruptcy without much trouble, you cannot say the same for the federal government, which would then be on the hook for much of the cleanup and damage awards.

Still, you’d have to sell off a LOT of assets before we get to that point.