Oil prices hold Footsie back

The London market trod water below its opening mark today as high oil prices continued to take their toll on equities.

The FTSE 100 Index failed to make up earlier losses, standing 5.4 points off at 4843.9 by mid-morning.

The price of a barrel of crude rose 0.32 cents to 55.71 in futures trading in New York.

Concern about potential fuel shortages in the wake of problems at refineries in the US was to blame for the increase, analysts said.

Energy giants BP, Shell and BG Group benefited from the rises.

BP was top of the Footsie risers with a 6.5p gain to 538.5p, while Shell picked up 3.5p to 475.5p and BG adding 3p to 415.25p.

However, those affected negatively by the oil price rise included packaging group Rexam, which fell 1.75p to 471.75p and cruise ship operator Carnival, which eased 26p to 2763p.

Corporate news was thin on the ground, although speculation surrounding a potential bidding war for Allied Domecq helped to push shares in the drinks giant further ahead.

While the group agreed terms of a takeover with Pernod Ricard last week, it is thought it could yet get a rival offer from America’s Constellation Brands, whose portfolio includes Hardys wine and Corona beer. Allied shares rose 3p to 666p.

Among top-flight fallers, ITV was second with a 3.25p drop to 125.5p as some of the recent takeover speculation surrounding the broadcaster slipped away.

And Barclays eased 2p to 554p after it said it was in talks with shareholders of South African bank Absa about a potential £2.8 billion bid for 60% of the group.

Elsewhere, shares in vodka maker Blavod Extreme Spirits continued Friday’s gains after the grou said successful wine launches in the US had helped it snap up orders in the UK. Shares rose 4% or 0.75p to 18.5p.