MARKET REPORT: Oil Price Soars as Middle East Fighting Intensifies

Oil and defense stocks rose, but airlines fell as tensions in the Middle East rose.

The price of Brent crude oil jumped above $75 a barrel, after earlier in the day being below $70.

Fears have grown over the possibility of an all-out war between Israel and Iran and the impact on oil supplies.

The rise in the price of crude oil sent BP shares up 2.4 per cent, or 9.3 pence, to 401 pence, and Shell shares up 2.2 per cent, or 53 pence, to 2,478 pence.

And defense giant BAE Systems rose 2.9 per cent, or 36p, to 1,273.5p.

But airlines were among those hit by concerns about the outlook for the cost of jet fuel and the disruption to international travel.

British Airways owner IAG lost 5 per cent, or 10.2 pence, to 195.2 pence, Easyjet fell 3.5 per cent, or 18.4 pence, to 501.6 pence and Wizz Air fell 3.5 per cent, or 18.4 pence, to 501.6 pence. sank 5.7 per cent, or 83 pence, to 1,367 pence.

Danni Hewson, head of financial analysis at brokerage AJ Bell, said: “No one will overlook the human cost that will be a result of rising tensions and violence in the Middle East, but there will also be economic ramifications if things escalate. even more.”

“The past few years have taught us all about the impact that an increase in a barrel of black stuff can have on inflation and the burning embers could quickly rekindle if supply chains are further compromised.”

The FTSE 100 rose 0.5 per cent, or 39.7 points, to 8,276.65 and the FTSE 250 lost 0.7 per cent, or 138.49 points, to 20,914.7. Greggs has blamed bad weather and riots for the slowdown in sales.

The bakery chain, known for its baked steaks, sausages and donuts, said comparable sales at its stores rose 5 percent in the third quarter.

But that figure was down from 7.4 percent in the first half.

Chief executive Roisin Currie said business was hit because summer riots kept customers away from some of its stores, while “wet, wet weather” also hit demand. The shares fell 5.8 per cent, or 182 pence, to 2,942 pence.

Greggs insists it is still on track to meet its annual targets, while the level of cost inflation is now expected to be towards the lower end of the 4 to 5 per cent range previously forecast.

The company has opened 152 stores and closed 66 so far this year, making 86 in total.

As a result, Greggs remains on track to open between 140 and 160 net new stores in 2024.

Haleon’s largest investor has reduced its stake in the maker of Sensodyne and Panadol. US pharmaceutical giant Pfizer offloaded shares worth £2.43bn, reducing its stake from 22.6 per cent to 15 per cent.

The London-listed consumer healthcare business was co-owned by GSK (up 0.3 per cent, or 5p, to 1,521.5p) and Pfizer before demerging and listing in July 2022.

Haleon shares, however, rose 0.5 per cent, or 2.1p, to 395p.

There has been a fresh blow for Conservative peer Lord Ashcroft after marketing agency Jaywing warned its finances are under pressure and additional funds are needed as clients delayed spending over the summer.

Ashcroft is the company’s largest shareholder with a stake close to 30 percent. Jaywing shares plunged 22.2 per cent, or 0.5p, to 1.75p.