LONDON, July 10: Oil prices slipped on Monday from last week's record peaks, on profit-taking caused by easing concerns over Iran, analysts said. New York's main contract, light sweet crude for delivery in August, dropped 84 cents to $73.25 per barrel in pit trading. The contract had hit a historic $75.78 last Friday owing to simmering geopolitical tensions, particularly over Iran and North Korea.

Brent North Sea crude for August delivery shed 85 cents to $72.40 per barrel in electronic deals on Monday. It had touched a record $75.09 on Friday.

“Prices gave back some of their recent gains on some optimism over the Iranian nuclear dispute,” Barclays Capital analyst Kevin Norrish said in London.

He added that markets reacted positively to comments by EU officials describing last Thursday’s meeting between European Union foreign policy chief Javier Solana and Iran's top atomic nuclear negotiator Ali Larijani as constructive and representing a good start for the further set of negotiations on Tuesday.

Norrish, however, added on Monday: “Such optimism is bound to be short-lived, and we expect geopolitics, and the Iranian dispute, in particular, to remain a key supportive factor for prices.”

Mark Pervan, an analyst with Melbourne-based Daiwa Securities, said the market likely remained anxious about geopolitical developments in the Middle East and North Korea.

“Oil premiums won't be washed out in the short-term,” he said.

Tehran is facing mounting international pressure to give a clear answer before the Group of Eight (G8) summit from July 15-17.

“Oil is a political commodity and could be used against the West. There may be developments (in negotiations) with Iran but things are still fairly unresolved,” Pervan said.

Another worry for traders is North Korea, which has kept the market volatile. Although the Asian power is not an oil producer, its controversial missile tests last week jangled international tensions.

Added to the picture, oil prices are also supported by buoyant demand for motor fuel in the United States amid the ongoing peak-demand driving season where many Americans hit the roads for vacations.—AFP