LONDON (ShareCast) - Rising crude prices helped lift stocks in the oil sector on Monday, as the ongoing violence in Iraq raised concerns about the knock-on effect on supply.

Fighting between the Iraqi army and Sunni Islamist insurgents escalated this weekend after militants from the Islamic State of Iraq and the Levant (ISIL) took over the city of Tal Afar.

Iraq claims that nearly 280 "terrorists" were killed yesterday.

Meanwhile images were released online allegedly showing the killing of hundreds of Iraqi soldiers by militants.

Brent crude futures for August delivery were up 0.13% at $112.61 a barrel this afternoon, having risen as high as $113.28 earlier on. The July contract, which expired on Friday, settled at $113.41, its highest since September 9th 2013.

The US is now reportedly considering talks with Iran to support the Iraqi government in its fight against Sunni Islamist insurgents.

"Any intervention will give investors’ confidence that the US government is willing to act to prevent a supply-shock in crude oil and that could contain oil prices," said Jasper Lawler, Market Analyst at CMC Markets UK.

In other news, gas prices also climbed after Russia's Gazprom cut off supplies to Ukraine.

Gazprom, which claims that Ukraine already owes it $4.5bn for gas supplied, said it now requires advance payments before exports gas to the country.

Tullow Oil, Shell and Premier Oil were among the best performers today.

Among the smaller stocks, shares in New Zealand- and Australia-focused oil explorer Mosman Oil & Gas jumped after the company announced "continued excellent results" from drilling at its Petroleum Creek Project.

Meanwhile, Solo Oil, UK Oil & Gas Investments and Stellar Resources all surged after announcing that construction of a well on their joint-owned Horse Hill Prospect near Gatwick Airport has begun.

"The breaking of ground at the Horse Hill Prospect marks the start of a potentially exciting era for Stellar Resources and the Horse Hill Development partners," said Stellar's Chairman David Lenigas.


Top performing sectors so far today
Mining 16,228.73 +0.88%
Oil Equipment, Services & Distribution 24,620.99 +0.40%
Oil & Gas Producers 8,661.15 +0.12%

Bottom performing sectors so far today
Industrial Metals & Mining 1,121.17 -5.06%
Fixed Line Telecommunications 4,424.52 -2.36%
Real Estate Investment & Services 2,624.43 -1.91%
Aerospace and Defence 4,823.41 -1.63%
Automobiles & Parts 8,650.84 -1.33%

BC

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