FTSE 100 Tumbles as Oil Prices Surge Past $108

The FTSE 100 index fell to a two-month low on Tuesday due to rising oil prices, which pushed Brent crude above $108 per barrel. This surge in energy costs has left investors concerned about inflation and its impact on borrowing costs.

Banks and investment firms led the decline, with Standard Chartered down 1.7% and Aberdeen off 2.6%. Precious and industrial-metals miners also weakened as gold and copper prices fell.

Danni Hewson from AJ Bell noted that rising oil prices are becoming harder for UK consumers to absorb and would be a key focus when the Bank of England meets this week. The bank is expected to leave Bank Rate unchanged at 3.75%, but markets have moved towards additional tightening later this year.