Oil prices leapt by more than a dollar yesterday before falling back as fears of a protracted war in Iraq remained at the forefront of traders' minds.

Dealers are concerned that a longer, drawnout war in the Middle East will hamper world oil supplies.

The benchmark price of Brent crude shot up 1.16 dollars before slipping back to 26.25 dollars a barrel.

The effect on confidence has not been restricted to the oil markets.

Oil prices have been extremely volatile in the run-up to the start of hostilities, with the onset of fighting in Iraq hitting supply in the world market place.

Friday March 28 2003