Oil prices stay above $70 in Asian trade

The prices threatened to test record levels as a suicide bomb attack in Israel compounded tensions over Iran's N-plan.

Crude oil prices held above $70 in Asian trade on Tuesday and threatened to test record levels as a suicide bomb attack in Israel compounded tensions over Iran's nuclear programme, dealers said.

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Supply concerns amid falling gasoline inventories in the United States also continued to push prices higher.

At 10.30 am, New York's main contract light, light sweet crude for May delivery, was up six cents at $70.46 a barrel from its close of $70.40 in US trading on Monday.

This is just within striking distance of the $70.85 reached on August 30 last year after Hurricane Katrina hammered oil production facilities in the US Gulf of Mexico region.

"Once the psychological level of $70 was breached, there was momentum which spurred fresh buying," said Victor Shum, a Singapore-based analyst with global consultancy Purvin and Gertz. "Passing the $70.85 level is inevitable."

The US administration said on Monday that Iran's announcement that it was working on advanced P-2 centrifuges to enrich uranium was a further signal that the Islamic republic's nuclear programme is not purely civilian.

Iran's announcement comes on the back of escalating tensions over Tehran's alleged nuclear weapons research programme.

Further fueling tensions in the region was a suicide bomb attack in the Israeli capital of Tel Aviv on Monday which left nine people dead.