Oil prices steadied at $70 today after a slide on growing US gasoline inventories, softness across commodities sectors and signs of progress in the stand-off over Iran's nuclear ambitions.
US crude was 20 cents up at $70.06 a barrel early this morning after losing $1.90 or 2.7 per cent yesterday. London Brent crude gained 13 cents to $69.35.
US gasoline stocks rose by 2.1 million barrels last week, well ahead of a 1.2 million forecast as refineries delivered increased output ahead of the Memorial Day holiday on May 29th, the traditional launch of the US summer driving season.
Oil slipped in tandem with most commodities. Copper fell more than 6 per cent to reverse much of the previous session's recovery and gold fell over 5 per cent to its lowest level in a month as investors continued to worry high prices would hurt demand.
Many commodity classes have recently traded around record highs, prompting concerns about inflation, higher interest rates and a slower global economy.
Oil is below April's record $75.35, but is still up nearly 15 per cent from the start of the year.
World powers meeting in London on Wednesday said they had made progress on a package of proposed threats and incentives to stop Opec member Iran's nuclear programme, which some believe is for weapons despite Tehran's insistence it wants nuclear power.
A spokesman for the US State Department said that Iran, the world's fourth-biggest oil exporter, had sought bilateral talks with the United States but that Washington would stick to a multilateral approach.
Longer-dated crude forward contracts are above $70 as expectations for a rough summer hurricane season underpin prices.
The US government has said the US Gulf, still recovering from 2005, could see up to ten hurricanes this year.