May 26 (Bloomberg) -- Australia's S&P/ASX 200 Index rose, led by Woodside Petroleum Ltd. and Santos Ltd., as oil prices climbed above $51 a barrel, boosting producers' earnings.

Qantas Airways Ltd. dropped on concern higher oil prices will increase costs.

``Australia is a net exporter of oil so there are positives and negatives for the stock market,'' said Atul Lele, who helps manage the equivalent of $500 million at White Funds Management in Sydney. ``Higher costs are eating into profits worldwide, but on the other hand a few producers help to boost the index.''

The S&P/ASX 200 Index was little changed, adding 2.10, or 0.1 percent, to 4093.20 at the 4:05 p.m. close in Sydney. About five stocks slid for every four that gained.

New Zealand's NZSX 50 Index fell 1 percent to 3007.34 at the 5 p.m. close in Wellington. Telecom Corp., which accounts for a quarter of the benchmark index, dropped 0.8 percent.

Woodside Petroleum, Australia's second-biggest oil producer, rose 49 cents, or 2 percent, to A$24.71. Santos, the third- biggest, added 8 cents, or 0.8 percent, to A$9.95.

Qantas, Australia's biggest carrier, dropped 4 cents, or 1.2 percent, to A$3.24. Jet fuel makes up about 15 percent of the airline's costs.

Crude oil for July delivery rose for a third day in New York, climbing 2.6 percent to $50.98 a barrel. Oil traded at $51.12 in after-hours trading as of 4:13 p.m. Sydney time.

The S&P/ASX 200 Index's futures contract for June added 0.2 percent to 4092. The broader All Ordinaries Index gained 0.1 points to 4050.40.

The following stocks also rose or fell. The stock symbols are in brackets after the company names.

Australian stocks:

Australian Stock Exchange Ltd. (ASX AU) rose 16 cents, or 0.7 percent, to A$21.88. The nation's biggest exchange was raised to ``neutral'' from ``underperform'' by Arjan van Veen, an analyst at Credit Suisse First Boston. The exchange plans to cut at least 10 percent of its workers to help reduce costs by as much as A$20 million ($15 million) by 2008, the Australian Financial Review reported, citing Chief Executive Tony D'Aloisio.

Foster's Group Ltd. (FGL AU), Australia's biggest winemaker and brewer, gained 17 cents, or 3.2 percent, to A$5.45. Foster's has 91 percent of takeover target Southcorp Ltd. (SRP AU), allowing it to compulsorily acquire the remaining stock.

The company took management control of Southcorp earlier today, appointing Martin Hudson as interim Chief Executive and putting a majority of its appointments on the board. With full ownership it can completely integrate the companies, maximize savings and use Southcorp's cashflow to pay off debt.

James Hardie Industries NV (JHX AU), the biggest maker of home siding in the U.S., fell 13 cents, or 2 percent, to A$6.50. New home sales in the U.S. increased to a 1.316 million annual rate during April, less than the 1.325 million rate expected by economists in a Bloomberg News survey. The gain in March was revised lower to 1.313 million from 1.431 million.

Newcrest Mining Ltd. (NCM AU), the biggest Australian gold miner, lost 21 cents, or 1.4 percent, to A$14.92. The company said a fire broke out underground at its Telfer gold mine in Western Australia.

Oil Search Ltd. (OSH AU), Papua New Guinea's biggest oil producer, added 4 cents, or 1.6 percent, to A$2.48. The company's 2008 production may fall less than forecast if revised estimates of the Yemen oil project hold good, Credit Suisse First Boston said in a report, citing the field's operator, Norway's DNO ASA. If the new estimate is confirmed, Oil Search's 2008 output may fall by 2.4 percent instead of 10 percent, it said.

Woolworths Ltd. (WOW AU) rose 45 cents, or 2.9 percent, to A$16.02. Merrill Lynch & Co. and Goldman Sachs JBWere raised their earnings estimates for the company after it agreed to buy the New Zealand business of Foodland Associated Ltd. for A$2.2 billion.

New Zealand stocks:

Hirequip New Zealand Ltd. (HQP NZ), a New Zealand hire company and property developer, dropped 5 cents, or 4.6 percent, to NZ$1.05. Dwane Clark, an analyst at First NZ Capital, cut his rating in a report today to ``neutral'' from ``outperform'', citing the stock's 15 percent rise since May 6, compared with a 4 percent gain in the benchmark.

Sky City Entertainment Group Ltd. (SKC NZ), New Zealand's largest casino operator, fell 19 cents, or 4.3 percent, to NZ$4.23. The stock has dropped 6 percent since Tuesday when the company lost an appeal to stop the introduction of warning messages on its slot machines.

Warehouse Group Ltd. (WHS NZ), New Zealand's biggest retailer on the benchmark index, dropped 13 cents, or 4 percent, to NZ$3.12. It sank 3.6 percent yesterday on concern Woolworths Ltd.'s purchase of a chain of supermarkets, announced yesterday, may lead to more competition.

To contact the reporter for this story: Stuart Kelly in Sydney skelly22@bloomberg.net

Last Updated: May 26, 2005 03:02 EDT