EDITORIAL  - A new Japan

SINGAPORE (AFP) - Oil prices were mixed in Asian trade Friday in a market watching tight US gasoline (petrol) prices and fresh tensions over Iran, dealers said.

At 11:41 am (0341 GMT) New York's main oil futures contract, light sweet crude for delivery in July, rose 20 cents to 64.38 dollars a barrel after plunging 1.59 dollars to end at 64.18 dollars a barrel in late US trades Thursday.

Brent North Sea crude for July delivery was down five cents at 70.67 dollars a barrel, after hitting a peak of 71.80, the highest level since August 28, 2006.

"There are still concerns over the gasoline supplies. Refineries are still having issues," said CFC Seymour analyst Steve Rowles in Hong Kong.

The US Department of Energy (DoE) said in its weekly report Wednesday that gasoline stocks rose 1.5 million barrels in the week to May 18 but remained "well below the lower end of the average range."

The market has been preoccupied with gasoline prices ahead of the peak demand season from the end of this month when Americans take to the roads on holiday.

Rowles said this week's gasoline inventory numbers were higher than market consensus.

"The numbers are fine but looking deeper into the reality, there is still some uncertainty ahead," he said.

"For this time of year, this is the lowest (US gasoline) supply coverage of the past five years," said Citigroup analyst Tim Evans in response to the DoE report.

Traders also took note of an abundance of crude oil in the United States, particularly in the Cushing terminal in Oklahoma where "light sweet crude" is delivered, the reference for the New York market.

The inventories are already elevated due to numerous breakdowns and repairs at US refineries that have tied up the supply chain.

Crude inventories have climbed by 900,000 barrels since last week to 27.4 million barrels.

The market was also tracking developments over Iran's nuclear ambitions, with Brent prices rising Thursday on geopolitical concerns over.

US President George W. Bush warned Thursday that the United States and its European allies would seek to toughen sanctions on Iran because it is defying United Nations demands to curb the project.

The United States has sent its biggest naval armada in years into the Gulf near Iran for exercises.

On Wednesday, the UN nuclear watchdog said Iran was defying UN Security Council demands to stop enriching uranium and was expanding the work.

Energy experts argue that Iran, the world's fourth biggest producer of oil, could retaliate with cuts to its crude exports, which in turn could push prices higher.