Monday morning business bulletin

May 12 2008 By Andrew Mernin

Oil prices holding firm near record levels helped put the FTSE 100 Index on the front foot today.

Heavyweights BP and BG Group were early beneficiaries as crude stood above 125 dollars a barrel, within sight of Friday’s latest peak of 126.20.

This helped the wider London market 30 points higher to 6234.7 after an hour as stocks bounced back from a poor end to last week.

BP was 7p higher at 620p, while BG Group gained 14p to 1355p.

British Gas owner Centrica warned today of potential further bill hikes for customers after revealing that continued high wholesale gas prices would hit results this year.

The firm said that overall operating profits for the first half of this year would be ``materially lower" compared with a year ago, mainly due to poorer performance in its British Gas Residential arm.

It added that wholesale gas prices for the second half of this year were double those compared with a year ago.

Centrica said: ``While the current outlook for gas prices does create a challenging environment for energy suppliers, we will take the necessary action to deliver reasonable margins in the retail business."

British Airways yesterday confirmed the hunt was on to find a new operations and customer services boss in the wake of the Heathrow Terminal 5 shambles amid reports the recruit will be groomed to succeed chief Willie Walsh.

The airline is searching for a new chief operations officer - a role created after two executives quit following the T5 fiasco - who would reportedly be lined-up to succeed Mr Walsh, the carrier’s chief executive who has come under heavy criticism since the terminal opening debacle.

BA said it was ``very premature" to speculate on plans to promote the recruit to the top job, but said the role was extremely challenging, with responsibility for 20,000 staff.

The pound at 9am was US$1.9476 compared to US$1.9484 at the previous close while the euro at 9am was £0.7907  compared to £0.7932 at the previous close.

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