BP's relief well drilling operations continue to move forward with an interception of the leaking well in the Gulf of Mexico expected by the end of the week, a senior U.S. official said Monday.

Retired Coast Guard Adm. Thad Allen, who is tasked to handle the oil spill, said the cement cap installed on the top of the Macondo well last week was holding, and the first relief well is expected to intercept the underwater gusher "toward the end of the week."

"We expect that sometime before the end of the week we will be able to intercept the annulus and commence the kill," he said, adding that authorities were closely watching a tropical weather system moving east over Florida toward the Gulf of Mexico which might affect the timing of the "bottom kill" operation on the leaking well.

The so-called "static kill" operation, which commenced on Aug. 3, is the biggest development in BP's 100-day plus spill ordeal since it placed a tight-fitting cap over the blown-out well in mid-July, stopping oil from flowing into the ocean for the first time after a deadly rig blast in late April opened the underwater gusher.

Following the completion of cementing operations on the Macondo on Aug. 5, pressure testing was performed which indicated there is an effective cement plug in the casing. BP believes the "static kill" and cementing procedures have been successful, BP said in a statement.

Both federal officials and BP said relief wells being drilled are the "answer" to permanently sealing the ruptured well.

The first relief well had been drilled down some 17,909 feet (5,426 meters) below the sea level and was only 30 to 40 feet (9.1 to 12.1 meters)away from the outside casing of the well, Allen said.

President Barack Obama on Monday hailed BP's progress to seal the leaking well. "Yesterday we learned that the procedure to prevent any more oil from spilling with a cement plug appears to have succeeded," he said.

However, he warned that the battle is not over. "I've made the commitment to the people of the Gulf Coast that I would stand by, not just until the well is closed, but until they recover from the damage that's been done," he said.

Also on Monday, BP said in a news release that the costs of its response to the Gulf of Mexico oil spill rose to approximately 6.1 billion U.S. dollars.

That figure included the cost of the spill response, containment, relief well drilling, static kill and cementing, grants to the Gulf states, claims paid and federal costs, the company said.

Meanwhile, BP said that as of Saturday, more than 145,000 claims had been submitted and more than 103,900 had been paid, totaling 319 million.

In another related development, BP said Monday it made an initial payment of 3 billion dollars into a 20-billion-dollar escrow fund to compensate residents and businesses affected by the oil spill in the Gulf of Mexico.

"The purpose of the escrow account was to assure those adversely affected by the spill that we indeed intend to stand behind our commitment to them and to the American taxpayers," BP's newly appointed CEO Bob Dudley said in a statement.

"Establishing this trust and making the initial deposit ahead of schedule further demonstrates our commitment to making it right in the Gulf Coast," he said.

Two individual trustees have been named to administer the newly-established fund, including former U.S. District Judge John S. Martin and Kent Syverud, dean of the Washington University School of Law, according to the statement.

Citigroup will serve as corporate trustee and paying agent for the account.

BP, the operator of the Deepwater Horizon drilling rig that exploded off Louisiana and unleashed the worst spill in U.S. history in late April, agreed to set up the claim fund in mid-June under pressure from Obama.