Brent crude rallied to a 2015 high and helped the commodity-heavy FTSE 100 get back to within striking distance of its long-standing ceiling.
The index added 45.41 points or 0.7 per cent to 6,873.52, but the Footsie still lags some of its peers, as Germany’s Dax reached new all-time highs on the back of strong economic growth figures.
Tony Cross, market analyst at Trustnet Direct, said: “A sharp rise in oil prices has been the saving grace for the day’s fortunes with Brent crude topping $60 a barrel and finding new highs for the year.”
Oil stocks dominated the blue chip risers’ board with Tullow Oil up 5 per cent or 19.9p to 405p and BG Group adding 4 per cent at 974.8. BP was 9.9p higher at 454.2p and Shell advanced 33p to 2,236.5p.
GlaxoSmithKline was another strong riser after UBS ditched its “sell” rating on the pharmaceuticals stock and recommended that clients now buy the shares. The stock jumped 67.5p to 1,553p.
Rolls-Royce shares were in the spotlight after it announced a further downgrade to profits guidance for this year. Announcing annual results, the group said 2015 will be tougher than expected as the recent slide in oil prices has resulted in “increasing uncertainty” for many of its customers, particularly in the marine sector. Shares fell by as much as 2 per cent but later recovered to end the session 39.5p higher at 944.5p.
Stocks on the back foot included BT after US-owned rival Virgin Media vowed to spend £3 billion on expanding its fibre-optic broadband network over the next five years. BT shares have been at a 14-year high in recent days but fell back 2 per cent or 10.9p to 439.1p. Sky was 8.5p lower at 919p. Elsewhere in the telecoms sector, TalkTalk shares dipped 3.7p to 320p after its shares were cut to “underperform” by broker Jefferies.