Oil prices tumble on fuel report

Crude oil prices have tumbled by more than $2 a barrel after a government report showed that US petrol reserves have increased.
Concern that gasoline supplies would not be able to meet demand during the summer holiday months has been one of the factors underpinning record prices.

New York light crude shed $2.33, or 3.1%, to $72.28. London's main contract Brent crude slid $1.99 to $72.65.

That slide helped push US gasoline prices more than 4% lower.

'Trimming travel'

The Energy Information Administration (EIA) said on Wednesday that gasoline stocks in the US rose by 2.1 million barrels last week.

Analysts said that the increase, the first since February, may have been down to consumers driving less because of higher petrol prices.

"I think high prices, without question, are starting to have an effect on demand," said Bill O'Grady, an analyst at AG Edwards.

His comments were echoed by Mark Routt, an analyst at Energy Security Analysis, who said that there "is evidence that American drivers are making some adjustments as a result of high prices".

"People are trimming discretionary travel, and choosing options other than driving to get places when they have that choice," he said.

However, the EIA said that geopolitical tensions and concerns about a clash between the US and Iran over the latter's nuclear programme are likely to underpin oil prices in coming months.