Oil prices fall in Asian trade after sharp gains

SINGAPORE (AFP) - Oil prices were lower in Asian trade Tuesday, giving up some of the sharp gains made overnight on continued concerns about tight US gasoline (petrol) supplies, dealers said.

At 11:00 am (0300 GMT), New York's main oil futures contract, light sweet crude for delivery in July, was down 17 cents at 66.04 dollars per barrel after a gain of 1.13 dollars in late US trades Monday.

Brent North Sea crude for July was down five cents at 70.35 dollars.

Dealers said the market was also keeping an eye out on the approaching Atlantic hurricane season after US weather experts and forecasters predicted an "active" season ahead.

"We are coming into June which is hurricane season in the United States. While we are in the driving season, things over the months will be about the hurricanes ... all indications are that there could be some hurricane damage this year," said Rowles.

Meanwhile, gasoline supply fears are supporting prices because of lower-than-average US stocks as demand hits its peak as millions of Americans take to the nation's highways for their summer vacations.

The heated rhetoric between Washington and Tehran have also triggered concerns about potential interruptions to Iran's oil exports, dealers said.

US Secretary of State Condoleezza Rice on Monday accused Iranian President Mahmoud Ahmadinejad of "digging a deeper and deeper hole for his country" after he launched a new verbal attack on Israel.

Ahmadinejad said Sunday that a "countdown" had begun that will end with Lebanese and Palestinian militants destroying the Jewish state, a process he said was started almost a year ago by the war between Israel and Lebanese militant group Hezbollah.