Strength in British Airways was also a feature, up 15.25p at 384.25p, on news it has placed an order for 12 Airbus A380 superjumbos and 24 Boeing 787 Dreamliner aircraft, with options for a further seven Airbus A380s and 18 Boeing 787s.

All the aircraft will be powered by engines from Rolls Royce, with its shares up 3p at 524p.

In reaction, Merrill Lynch said that the group is maintaining its 'buy' stances for both British Airways and Rolls-Royce, with price targets of 600p and 620p, respectively.

In other comment, Collins Stewart said following the news, in its view BA looks cheap on every measure. It is optimistic that next week's September traffic statistics release will show a good trading performance and it believes forward bookings and premium demand remain strong.

The broker repeated its 'buy' stance and 580p price target.

The RNS after the bell will also help with INVESCO upping its stake to just over 10%

LONDON (Thomson Financial) - British Airways said it is increasing its fuel surcharge on all tickets booked from Nov 15 in response to record oil prices and its rising fuel costs.

The move comes just 10 days after chief executive Willie Walsh said the airline had no plans to increase its surcharges. 'We're 90 pct hedged at between 68 usd and 70 usd until March 31, next year,' he told reporters when the group unveiled a 26 pct rise in interim pretax profits on Nov 2.

A BA spokesman told Thomson Financial News that the hike followed recent rises in oil prices. 'The market is different now to how it was then,' he said.

The airline said today it expects the cost of fuel to increase by 136 mln stg in the second half of the year, with the total bill for the year expected to exceed 2 bln stg for the first time.

The charge for long-haul flights of less than 9 hours will increase by 10 stg per flight to 48 stg, while the cost for flights longer than nine hours will increase by 15 stg to 58 stg per flight, it said. The charge for short-haul flights will rise 2 stg to 10 stg per flight, it added.

BA commercial director Robert Boyle said: 'The cost of oil has reached record levels, rising by more than 20 usd per barrel since we last increased our fuel surcharge in June 2007.'

BA said it will make similar adjustments in markets outside the UK.

Other airlines including Air Berlin and Aer Lingus have recently increased their long-haul surcharges.

But Ryanair, which guarantees no fuel surcharges on its flights, said the increases were an example of 'another rip-off from BA'. 'It highlights their double standards: one week they say they won't increase fuel surcharges and the next they put them up,' a spokesman said.