Oil hits two-and-a-half year highs

8th Apr 2011 11:41

Oil prices hit fresh two-and-a-half year highs in London amid continuing worries over supplies from Libya and as the dollar slid against other currencies.The rebels in Libya have accused government forces of attacking three different oil installations in the east of the country, halting production. Brent crude climbed by more than a dollar to sit above $124.The dollar weakened against the euro, which has been boosted by the recent European Central Bank rate rise, and the Australian dollar was at a 29-year high against the US dollar.The higher oil price influenced the FTSE 100, with British Airways owner IAG and the crude-thirsty cruise operator Carnival among the heaviest fallers.Meanwhile, shares in Fresnillo, which mines for silver in Mexico, were the best performing in London's leading share index. Silver hit $40 an ounce for the first time since 1980, while gold prices have hit record levels.A study by the precious metals consultancy GFMS says silver prices could hit $50 an ounce this year - only to slide back if investors withdraw from the market.