By Liisa Tuhkanen
LONDON (Reuters) - Britain's top equity index fell on Friday as lower oil prices hit energy stocks and concerns over Greece's talks with international creditors weighed on sentiment.
The blue-chip FTSE 100 fell 0.9 percent to 6,788.00 points by 1423 GMT after gaining in the previous two sessions.
The biggest weight on the index was Royal Dutch Shell (LONDON:RDSa), which fell 1.6 percent, trimming 8 points off the FTSE 100.
Rival oil major BP (LONDON:BP) dropped 1.5 percent, with the energy sub-index as a whole down 1.4 percent on cheaper oil.
Oil prices slipped after the world's top crude exporter Saudi Arabia said it was ready to raise output further if needed, potentially adding to oversupply.
On the upside, Royal Mail (LONDON:RMG) added 2.7 percent, with traders attributing the gains to a report indicating Ballymore has emerged as frontrunner to buy the Nine Elms RMG site.
The postal service fell 4.5 percent in the previous session after the British government announced it would sell half of its remaining stake.
"I don't expect that we're going to see anywhere near the momentum we would have seen when it was privatised initially, but certainly it does seem fairly valued in around the 500 pence mark," said London Capital Group analyst Brenda Kelly.
Investors were also focused on Greece's stalled debt talks after the International Monetary Fund ramped up the stakes on Thursday by announcing its delegation had left the negotiations in Brussels because of differences with Athens.
"Whilst investors have had plenty of time to reduce their direct exposure to Greece, any exit of the country from the euro zone will generate questions over the resolve and future of the European Union," Hargreaves Lansdown (LONDON:HRGV) equity analyst Keith Bowman said.
European Commission President Jean-Claude Juncker said on Friday that the talks between Greece and its creditors will restart, but that it was up to Greece to make the next move.
Athens needs a deal to unlock aid before the end of the month when it is otherwise set to default on a 1.6 billion euro ($1.8 billion) repayment to the IMF. That could trigger capital controls and possibly push Greece out of the euro zone.
Among mid caps, Bwin.Party fell 7.6 percent after saying two of its shareholders had decided to place up to 50 million shares in the online gambling firm.
Petra Diamonds (LONDON:PDL) dropped 7.3 percent after forecasting full-year revenue below market expectations.
The miner, which has four producing mines in South Africa and one in Tanzania, had warned in April that full-year results would be below market consensus due to variability in grade and production mix.