Oil prevents any further FTSE slippage

Rising oil prices helped the London market swing into positive territory today, with oil major BP leading the advance.

The FTSE 100 Index was 11.4 points higher at 6742.1, ahead of the seven-year closing high seen earlier in year before the recent turmoil in credit markets hit financial indices.

BP was up 12p at 631p after comments from chief executive Tony Hayward indicated that a recovery for the company should be fast in coming.

Meanwhile oil firms received a boost as the price of crude crept towards the 84 US dollar a barrel mark. Tullow Oil, which updated on exploration progress in Africa today, was ahead 13p at 640.5p and Royal Dutch Shell lifted 34p to 2075p.

Buoyant metal prices also drove heavily weighted mining stocks ahead, with Rio Tinto up 63p at 4638p and Lonmin 48p ahead at 3737p.

Shares in beleaguered Northern Rock went into reverse as the mortgage lender dampened hopes of a speedy rescue.

The firm fell 22%, or 61.25p, to 212p – wiping out more than half of last week’s 115p gain after confirming that talks with potential suitors were only “at a very early stage”, compounding weekend press reports of limited shareholder returns.

Alliance & Leicester dropped 16.5p to 784p and HBOS was 13.5p lower at 892p.

Brewing group SABMiller drifted back from recent gains – down 31p at 1452p - despite posting 11% organic growth in lager volumes and saying trading was in line with expectations.

Housebuilder Barratt Developments slipped 14p to 685p amid gloomy housing market prospects. Sector peer Taylor Wimpey was also off 5.25p at 276p.

Elsewhere, casino and bingo group Rank plunged 8%, or 10p to 115p. This followed a slump of just over 21% on Friday when it announced that profits would miss forecasts after its businesses were hit by the smoking ban and changes to gaming machine legislation.