HIGH oil prices fuelled a positive session on the London market yesterday, as a series of energy stocks racked up gains.

With the cost of a barrel of light crude hovering just below $64 in New York, Royal Dutch Shell added about two per cent to its market value and BP rose more than one per cent.

This contributed to the Footsie climbing 19.4 points to 5363.7, its highest close in three-and-a-half years.

The top flight has made considerable progress in recent weeks, now standing 300 points higher than at the end of June.

An upbeat performance across the Atlantic also boosted shares. The Dow Jones Industrial Average stood about 70 points higher by closing time in London.

Shell and BP - which make up about 20 per cent of the top flight index - increased 41p and 9.5p to 1909p and 659p respectively.

But they were beaten to the top of the blue-chip risers board by gas group BG, which added three per cent, or 15p, to 514.5p.

Oil-dependent stock British Airways made progress, despite the prospect of the oil price rise leading to higher fuel bills. Its stock advanced 2.5p to 288.5p.

Banking group Standard Chartered also made solid gains, up 29p to 1240p, as investors continued to cheer Monday's upbeat half-year results.

Mining stocks also contributed to the positive mood after Australia said it had agreed a deal that paved the way for uranium exports to China.

The move was seen as a positive development for Xstrata, which rose 24p to 1275p, while Rio Tinto added 28p to 2048p and BHP Billiton lifted 11.5p to 851.5p.

In contrast, water group Severn Trent was the heaviest Footsie faller as it went ex-dividend.

The stock retreated more than two per cent, or 24p, to 956p, while Kelda weakened 12p to 676.5p as it also went ex-dividend.

Other stocks failed to inspire the market with strong-looking half-year results.

Brewer Scottish & Newcastle fell 9p to 458.75p, even though it bucked the downward trend in the UK market and said pre-tax profits were in line with expectations at £163m, up 8.7 per cent on a year ago.

Mortgage bank Bradford & Bingley also fell, despite an eight per cent rise in underlying profits and comments that it believed the low point for the housing market may have passed. Shares were off nearly four per cent, or 12p, at 325.75p, making it the heaviest FTSE 250 faller.

Among others reporting yesterday, printing group St Ives cheered 4p to 380p after saying recent trading across the group had been in line with hopes.

The highest Footsie risers were BG Group, up 15p to 514.5p, Imperial Tobacco, rising 39p to 1485p, Standard Chartered, up 29p to 1240p, and Royal Dutch Shell, rising 41p to 1909p.

The heaviest fallers were Severn Trent, off 24p to 956p, Scottish & Newcastle, down 9p to 458.75p, Kelda, off 12p to 676.5p and Wolseley, down 15p to 1154p