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David Cameron bows to US on Libya probe

David Cameron bowed to pressure for a review of the decision to release the Lockerbie bomber yesterday as the affair cast a shadow over talks with President Barack Obama at the White House.

The Prime Minister resisted calls by US politicians for a full-scale inquiry but asked the Cabinet Secretary Sir Gus O'Donnell to review whether the Government should release any secret documents relating to BP's alleged role in the return of Abdelbaset al-Megrahi to Libya.

Mr Cameron was caught in the crossfire between American politicians, including Secretary of State Hillary Clinton, who want an inquiry, and BP, which allegedly lobbied for Megrahi to be sent back to Libya to help the oil giant land a £550m oil exploration deal in his home country.

Megrahi, the only person convicted of the 1988 Lockerbie bombing, which killed 270 people, was released by the Scottish government almost a year ago on the grounds that he had only three months to live. He has prostate cancer and is still alive.

Charles Schumer, a New York Senator, who met Mr Cameron in Washington last night, called for Megrahi to be brought back to spend the rest of his life in a Scottish jail. He urged Mr Cameron to order “a complete investigation and bring Megrahi back to justice”.

Passions are running high over the case in the US, where BP is public enemy number one because of the Gulf of Mexico oil spill. Mrs Clinton said: “That Megrahi is living out his remaining days outside of Scottish custody is an affront to the victims' families. We are encouraging the Scottish and British authorities to review again the underlying facts and circumstances leading to the release of Megrahi.”

Mr Cameron is reluctant to agree to a new inquiry, as it could weaken BP's share price at a time when the company is already on the ropes. “It was not the decision of BP. It was the decision of Scottish ministers,” he said yesterday.

Later the Prime Minister made a concession in an attempt to cool the row. He announced: “I am asking the Cabinet Secretary to go back over the paperwork to see if there is anything else that should be released, so that there is the clearest possible picture of what decision was taken and why.”

He rejected calls by senators for a moratorium on BP's operations in Libya. The documents under review are believed to include telephone and letter contacts between Jack Straw, the then Justice Secretary, and Sir Mark Allen, a former senior MI6 officer who was involved in talks on a prisoner-transfer agreement with Libya and who went on to work for BP.

Mr Cameron promised that Britain would co-operate fully with a Senate inquiry into the affair, due to start on July 29.

The Megrahi controversy has eclipsed Mr Cameron's first visit to the White House as Prime Minister. He held more than an hour of one-to-one talks with Mr Obama in the Oval Office before a working lunch with advisers.

David Miliband, who was Foreign Secretary at the time of Megrahi's release, admitted yesterday: “It was clearly wrong because it was done on the basis he had less than three months to live and it's now 11 months on.”

But Kenny MacAskill, the Scottish Justice Minister who released Megrahi on compassionate grounds, said Mr Miliband was part of Tony Blair's government, which he said struck a “deal in the desert” to return Megrahi to Libya under a separate prisoner-transfer agreement.

Cameron and Obama showed a united front on Afghanistan, the main subject of their discussions. They also papered over differences on the economy, despite fears in the Obama administration that European nations are cutting deficits too quickly. Mr Cameron passed on an invitation from the Queen for Mr Obama to make a state visit to Britain, expected next year.

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