Oil prices see FTSE rise – if only slightly

Global markets were dominated by the US air strike that killed one of Iran’s top generals as traders reacted to rising oil prices.

The FTSE 100 closed up 9.51 points, or 0.13 per cent, to 7,613.81 as oil companies dragged the index upwards, offsetting a fall for companies that buy lots of fuel, such as airlines.

General Qasem Soleimani, the head of Iran’s elite Quds force, was killed by a US air strike in Iraq. The attack pushed up the price of Brent crude, the international oil standard, by around 3 per cent to $68.14 (£52.08) per barrel. Oil prices are sensitive to tensions in the region, which accounts for a large part of global consumption.

CMC Markets analyst David Madden said: “London-listed oil stocks have benefited from the mega-rally in the oil market. The smaller oil stocks like Premier Oil and Tullow Oil have underperformed when compared with the bigger companies like BP and Royal Dutch Shell.”

However, with the likes of British Airwaysowner IAG falling – by 10.8p to 625.4p – the index advanced only slightly.

Shares in British American Tobacco rose 2.7 per cent to 3,352p after the tobacco giant welcomed the US health regulator’s move to ban popular e-cigarette flavours.

Turning to Next, the retailer has increased its profit forecast for the past year after posting higher sales than predicted in the last two months of 2019.

The business shrugged off the recent malaise affecting retailers to post a 5.2 per cent increase in sales for the period to 28 December, which it said was 1.1 per cent ahead of company forecasts. Shares closed down 0.2 per cent to 6,942p.