FTSE on course for highest finish since 2002

The FTSE 100 Index was on track to end the week at its highest level in three years today as the sky-high cost of crude boosted oil stocks.

Heavyweights BP and Shell both saw their market value rise by more than 2% - contributing to the Footsie surging 37.1 points to 5082.1 by mid-morning. The index last closed higher at 5085 in June 2002.

It came as the price of a barrel of US crude oil rose above $57 in New York, bringing it closer to its record of $58.28. One trader said the price could move higher still due to fears over continued tight oil supplies.

However, drinks giant Allied Domecq and insurer Royal & Sun Alliance both retreated following disappointment at takeover updates.

Allied lost nearly 2% of its value after US-based Constellation Brands said it would not be pursuing an offer, leaving the path clear for Pernod Ricard. Shares dropped 12.5p to 679.5p after Constellation said a deal would not create “sufficient value”.

However, the news lifted rival drinks firm Diageo, which was close to the top of the risers with a 10.5p increase to 815.5p.

R&SA was languishing in the red after financier Andrew Regan – best known for his attempt to buy the Co-op – abandoned his pursuit of the company. Shares weakened a penny to 82.5p.

Cosmetics specialist Body Shop rose 6p to 235p after revealing UK like-for-like sales had continued to buck the wider high street trend, up 7% in its first quarter.