A rise in the oil price to near $140 a barrel, a new peak, has helped push share prices lower again after another uncertain trading session.
Traders said weak US manufacturing figures left investors dumping the dollar, which in turn helped lift the crude price, despite reports that Saudi Arabia planned to pump more oil. Another factor in the oil price rise was a weekend fire at a Statoil platform in the North Sea, which has disrupted supplies to the tune of 150,000 barrels a day. To put that in context, the Saudis were supposed to be increasing production by 500,000 barrels a day.
So with the crude price on the increase, transport companies were under pressure on concern about the knock-on effect to their fuel costs. British Airways, already under the cosh after a sell note from Goldman Sachs, closed 11.25p lower at 239.25p. Cruise operator Carnival slipped 42p to £17.90, while bus and train group National Express reversed 26p to 865.5p, despite an upbeat note today from Investec about the company's Spanish operation.
However oil companies, not surprisingly, benefited from the latest moves in the crude price. BP added 2p to 587.25p, Royal Dutch Shell B shares rose 18p to £20.25p, while Cairn Energy closed 36p higher at £33.19.
But exploration group Soco International missed out, down 141p to £18.60 after inconclusive tests on a well in Vietnam.
Miners were higher on rising metal prices, some positive broker comment and continued takeover speculation. Eurasian Natural Resources Corporation ended 83p higher at £14.04 after a buy note from ABN Amro, while Anglo American added 148p to £33.37 on talk that Brazil's Vale may have the company in its sights.
By the close the FTSE 100 was 8.2 points lower at 5794.6, and the FTSE 250 slipped 16.8 points to 9635.5.
Among the smaller fry, retailer Instore - the former Brown & Jackson - jumped 65% to 8.88p after it said it was in bid talks. Analysts said the predator could be Aziz Tayub, a major shareholder who also owns the Crown Crest wholesale food business.
Drugs group SkyePharma climbed 32% to 7.25p after GlaxoSmithKline won US approval for its Requip XL treatment for Parkinson's disease. Requip uses SkyePharma's Geomatrix drug delivery system.
