Oils drag FTSE down; BP hit by criminal probe

* FTSE down 1.5 percent

* BP drags oil stocks down as U.S. launches criminal probe

* Drugmakers higher; GlaxoSmithKline up on Jeffries upgrade

By David Brett

LONDON, June 2 (Reuters) - Britain's top shares dropped early on Wednesday, with energy issues the main losers as BP (BP.L) fell after the U.S. government opened a criminal probe into its massive oil spill in the Gulf of Mexico.

By 0835 GMT, the FTSE 100 .FTSE was down 79.57 points, or 1.5 percent, at 5,083.73, having ended 0.5 percent lower on Tuesday, its lowest close since May 26.

BP (BP.L) fell 2.1 percent, having dropped 13 percent on Tuesday, as the United States launched criminal and civil probes into the six-week-old oil spill in the Gulf of Mexico.

BP has lost more than a third of its market value, or about 46 billion pounds ($67 billion), since the crisis began.

"There are murmurings that Obama may halt oil exploration in the area, which severely knocked energy stocks ... that has followed through to all the risk assets," Angus Campbell, head of sales at Capital Spreads said.

Other energy issues suffered too as the crude price CLc1 retreated, with Royal Dutch Shell (RDSa.L) shedding 2.2 percent, while BG Group (BG.L) fell 2.8 percent, Cairn Energy (CNE.L) dropped 2.3 percent, and Tullow Oil (TLW.L) lost 1.0 percent.

Tullow's decline, however, was moderated by a Citigroup upgrade to "buy".

Meanwhile, West African-focused oil explorer Afren (AFRE.L) was a strong mid-cap gainer, up 1.4 percent, supported by rumours that BG Group could launch a 140-pence-a-share cash offer, the Daily Mail's Market report said.

Miners were also a drag on the blue-chips, with the sector lower in tandem with weak metal prices. Kazahkmys (KAZ.L), BHP Billiton (BLT.L) and Anglo American (AAL.L) fell 2.2 to 2.9 percent.

Banks lost ground too as investors' risk appetite waned, with Royal Bank of Scotland (RBS.L), Barclays (BARC.L) and Lloyds Banking Group (LLOY.L) down 2.1 to 2.7 percent.

PRU PARED

Insurer Prudential (PRU.L) lost 2.6 percent, paring gains made in the previous session, after it said it was pulling out of its bold $35.5 billion takeover of AIG's (AIG.N) Asian life insurance arm, ending a three-month battle with shareholders who had argued the deal was over-priced. [ID:nTOE65100R]

Ex-dividend factors knocked 14.73 points off the FTSE 100 index, mainly due to heavyweight Vodafone (VOD.L) losing its payout attractions, with National Grid (NG.L), Marks & Spencer (MKS.L), AB Foods (ABF.L), and Intertek Group (ITRK.L) also trading ex-dividend on Wednesday.

On the upside, defensively perceived issues - stocks that tend to remain stable under difficult economic conditions - made up the few blue-chip gainers.

Drugmaker GlaxoSmithKline (GSK.L) added 1 percent, helped by an upgrade to "buy" from "hold" by Jeffries.

Peers AstraZeneca (AZN.L) and Shire (SHP.L) added 0.4 and 0.1 percent respectively.

Imperial Tobacco (IMT.L) climbed 0.5 percent, while Compass Group (CPG.L), the world's biggest caterer, rose 1.6 percent.

(Editing by Erica Billingham)