Energy stocks help to keep blue chips in the black

OIL prices reached a new record high yesterday before falling back as the London market ended a volatile session in positive territory.

Crude’s latest peak above $142 a barrel was good news for the oil giants but set nerves on edge elsewhere as the FTSE 100 index swung between gains and losses.

It closed 11.7 points higher at 5,529.9.

Energy stocks dominated the risers’ board, led by Tullow Oil, which gained 5% to 975p. Cairn Energy was 121p better at £32.07, BG Group cheered 53p to £12.51 and Royal Dutch Shell was 27p better off at £19.62.

The chief Footsie faller was heating and plumbing giant Wolseley, down 16p to 388p, after a broker downgrade.

Banks saw differing fortunes in a mixed session.

HBOS spent much of the day trading below its 275p discounted rights issue price, but the shares rebounded to close up 2.5p at 278.5p. Barclays was off 5.75p at 298p.

Tesco and Sainsbury’s were also on the retreat amid reports of a new price war brewing in the sector.

Sainsbury’s lost 6.25p to 308.75p, while Tesco shed 4.2p to 360.5p.

William Wordie, of broker Redmayne-Bentley’s Highland branch, noted that transport pair Stagecoach and FirstGroup both gained as results for peer National Express offered encouraging news of rising demand for public transport. They added 8p to 276.25p and 18.5p to 522.5p respectively.

Aberdeen companies Dana Petroleum, up 92p to £18.40, and Venture Production, 19p stronger at 842.5p, benefited from high oil prices.