Oil prices continue to rise

Brent Crude oil at $122 per barrel is going to be a tough one for businesses to stomach as energy costs go through the roof.

The cost of running factories, moving trucks and powering computers will put a squeeze on profit margins which means corporate earnings expectations may have to be reduced unless we see a significant reduction in inflationary pressures.

“It isn’t all bad news as a higher oil price is good for BP and Shell on the UK stock market, thereby giving a lift to the FTSE 100 index, up 0.2% to 7,478,” said AJ Bell’s Russ Mould.

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“Investors appear to be in defensive mood judging by the other stocks dominating the list of FTSE 100 risers. Utilities, precious metal miners and tobacco manufacturers were bid up, with more cyclical stocks in the form of industrial miners, financials and media among the biggest fallers.”