Oil prices climbed close to three-month highs, boosting European energy stocks, gold rose and the dollar eased today after the US and Britain indicated war with Iraq was increasingly likely.
The dollar fell towards a three-year low against the euro and hit its weakest level in nearly four years against the safe-haven Swiss franc on nervousness about possible military action.
In Washington, a US official said yesterday the campaign to rid Iraq of any weapons of mass destruction was entering its "final phase".
Gold, seen as a safe store of value in troubled times, headed higher, also boosted by the weaker dollar.
Bullion was last at $343.75, up from $340.35 at the New York close but well off last week's six-year high of $353.75.
Crude oil prices leapt at the opening of European trade today on worries over Iraq, whose oil exports make up nearly three per cent of global demand, and a protracted strike in Venezuela, also a major exporter.
Brent crude for February was 66 cents higher at $29 a barrel, not far off the three-month peak of $29.40 reached last Thursday.