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Oil trims gains driven by US-Iran tensions as FTSE drifts
by Max Julius on Jan 04, 2012 at 12:05
Oil prices on Wednesday trimmed recent gains on simmering tensions between Iran and the United States, while Britain’s FTSE 100 flatlined following the previous session’s strong gains.
Brent crude for delivery in February edged down 0.54% to $111.53 per barrel, after hitting a seven-week high of $112.59 earlier in the day, on fears over supply disruptions from Iran.
Iran on Tuesday said it did not want to see Washington redeploying an aircraft carrier in the Gulf region, in the latest sign of rising tensions over the Strait of Hormuz. Tehran has threatened to close the key transit point for crude in response to US and EU plans to impose oil sanctions on Iran in response to the country’s failure to negotiate over its nuclear programme.
Nonetheless, Helen Henton, head of commodities research at Standard Chartered, said that given the ‘potential geopolitical consequences’, and the impact on Iran’s own exports, the bank believed a blockade of the strait was unlikely.
She added: ‘More likely is that Iran’s export market options will be curtailed as sanctions are progressively tightened.’
Meanwhile, the UK index of blue-chip shares inched up 0.01%, or one point, to 5,701 and the All Share index edged down 0.05%, or two points, to 2,922. See the FTSE 100’s performance and the index’s top winners and losers
Next (NXT.L) topped the loser board, giving up 96p to £26.45, after the retailer reported sales that missed market expectations.
Shire (SHP.L) was the second biggest faller, giving up 53p to £21.72, amid concerns that at a shortage of hyperactivity drugs may put the group’s sales at risk.
Domino's Pizza perks buyers’ appetite
On the FTSE 250, Domino’s Pizza (DOM.L) jumped 27p to 441p after the pizza delivery group said its 2011 profit would meet market expectations and that sales had accelerated in the fourth quarter.
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