Crude oil prices continue to drop amid persistent supply glut
Oil prices have risen over the last two days due to official US data showing that oil drilling rigs’ production volume had fallen the most in a week in nearly three decades. Reuters

Oil and mining stocks are leading the FTSE100 for the second consecutive day amid renewed investor optimism, as commodity and energy prices continued to stage a recovery.

Vedanta Resources share price rose by over 6% to 420.31 by 1010 GMT, while the Petrofac's stock price surged over 5%.

BHP Billiton jumped over 4.8% while Scotland's Weir Group clocked a 5.11% jump to 1,822.61p after two hours of trading.

Anglo American followed suit with a 4.45% rise in its stock price while Glencore, Rio Tinto and others increased by a similar percentage mark.

Meanwhile, BP's stock price rose by 2.6% to 449.10p, despite the group saying that it will cut capital expenditures, after reporting lower profit for the fourth quarter and full-year 2014.

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Underlying profit for the fourth quarter declined by 20% year-on-year to $2.2bn (£1.5bn, €1.9bn), while full-year profit declined 10% to $12.1bn.

"Shares in BP have bounced higher after the oil titan posted a dip in profits that nonetheless was ahead of estimates," said David Madden, market analyst at IG Index.

"The company announced a fourth-quarter dividend of 10 cents to keep shareholders on side. The real surprise was the 13% cut in capital expenditure, which is relatively small when you consider the Gulf of Mexico disaster is still outstanding and Rosneft is being squeezed by sanctions. The shares rallied on the open, a perfect example of careful expectation management."

BP's rival Shell also saw a 2.9% increase in its stock price.

Oil prices have tumbled around 60% over the last six months however contracts seem to be dramatically shot up by 11% over the last two days.

The Brent forward contract was trading at $56.65 per barrel (bbl), up $1.90 while US crude was trading at $51.08/bbl.

Back in 2013 and 2012, oil prices averaged $100/bbl. In the summer of 2014, oil peaked at $115/bbl.

Oil prices have risen over the last two days after official US data showed that oil drilling rigs' production volume had fallen the most in a week in nearly three decades.