Europe close: Stocks slip as oil climbs on geopolitical worries

European shares surrendered early gains on Wednesday as investors monitored the war in Ukraine, digested the latest soaring UK inflation numbers and waited on back-to-back meetings of NATO, the G-7 and EU council were more sanctions were expected to be announced against Russia.

"The day looks to be a recurrence of war concerns, boosting oil prices while continental European markets fall sharply – those looking for the Dax and others to begin forming a short-term high after the recent bounce will be watching eagerly," said IG chief market analyst Chris Beauchamp.

"BP and Shell have topped the table this afternoon as the standout beneficiaries from yet another surge in oil prices."

The pan-European Stoxx 600 index surrendered early gains to finish 1.01% lower at 454.03, while Germany's Dax fell 1.31% to 14,283.65 and the FTSE Mib erased 0.96% to end the day at 24,298.66.

Front month Brent crude oil futures were up 4.5% to $120.6 per barrel on the ICE.

Energy stocks in demand as fears of oil supply disruption from the Russia-Ukraine conflict helped keep commodity prices higher. BP, Shell and Repsol shares were all higher on the news.

Worth noting, reports citing EU sources indicated that sanctions on Russian oil were at the least not imminent.

Ukraine President Volodymyr Zelenskyy said talks with Russia were still moving forward as his country continued to suffer shelling in several cities and the humanitarian crisis began to look increasingly desperate.

In the UK, official figures showed February inflation hit 6.2% as prices soared again and placed British households under more pressure from surging energy and fuel costs and a further hit next month from a pledge-breaking rise in personal taxes.

In equity news, shares in Auto1 Group plunged 13% despite reporting higher full-year profits.

Ultra Electronics was little changed after full-year results and media reports suggesting the government is close to agreeing a takeover of the defence firm by private equity-owned Advent via its Cobham subsidiary.