The UK’s benchmark FTSE 100 index edged higher on Tuesday, supported by a strong rally in energy stocks after BP reported better-than-expected first-quarter earnings.
The gains put the index on track to end a six-day losing streak, even as geopolitical tensions continued to weigh on sentiment.
The FTSE 100 rose 0.4% to 10,367.61 points by 1019 GMT.
In contrast, the mid-cap FTSE 250 index slipped 0.2%, marking its fourth consecutive day of losses.
BP results drive energy sector gains
Shares of British energy giant BP climbed 3.1% after the company’s first-quarter profit more than doubled year-on-year.
The strong performance lifted broader energy stocks, with Shell also gaining 2.3%.
Both companies provided the biggest boost to the blue-chip index.
Meanwhile, Tullow Oil surged 12% after forecasting that its annual oil production would come in at the higher end of its outlook range.
The company cited a strong start to the year.
The rally in energy stocks was further supported by rising crude oil prices, driven by ongoing geopolitical tensions linked to the US-Iran conflict.
Oil price outlook remains the same
Market analysts pointed to sustained strength in oil prices as a key driver for the sector.
The WTI crude oil price extended its recent rebound, approaching the key resistance level of $100 as geopolitical tensions between the United States and Iran persisted.
Prices climbed to around $97, marking a sharp recovery from this month’s low of $79.
The upward momentum has been supported by continued uncertainty surrounding the fragile ceasefire between the two nations.
The contentious US-Iran ceasefire has remained unresolved, keeping supply concerns elevated and driving crude prices higher in recent sessions.
Focus shifts to Bank of England policy
Investor attention is now turning to the upcoming policy decision by the Bank of England, where the central bank is widely expected to keep interest rates on hold.
Market participants will closely watch for any signals indicating a possible rate hike later in the year.
Britain’s heavy reliance on natural gas has made its economy particularly sensitive to rising energy prices triggered by geopolitical tensions.
The FTSE 100 remains about 5% below its late-February record high.
UK Government response to geopolitical risks
In response to the ongoing situation, UK Prime Minister Keir Starmer is set to host representatives from the Bank of England at a meeting of the government’s emergency response committee on Tuesday.
The discussions will focus on assessing the impact of the conflict in Iran on the UK economy.
Despite lingering risks, gains in the energy sector helped the FTSE 100 maintain upward momentum, highlighting the market’s sensitivity to commodity-driven movements.
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