LONDON, July 20: Oil prices steadied on Thursday as the market tracked events in the troubled Middle East and digested US energy data following three days of losses for crude futures.

In London, Brent North Sea crude for September delivery won 11 cents to $74.01 per barrel in electronic trading.

New York's main contract, light sweet crude for delivery in August, fell 21 cents to $72.45 per barrel in pit trading.

The August contract expires at the close of trading on Thursday, replaced by September delivery.

“The market's trying to come to terms with factoring how much risk there is in the current situation,” Global Insight analyst Simon Wardell said.

Oil prices struck record peaks at the start of the week owing to raging violence in the Middle East, before sliding amid expectations that the Israel-Lebanon crisis would likely not spread beyond the region nor involve major crude producer Iran, according to traders.

Crude futures have also dropped after the US Department of Energy revealed on Wednesday that energy stockpiles in the US rose across the board last week.

Supporting prices, however, is strong demand for motor fuel in the US. The DoE on Wednesday said that petrol, or gasoline, demand rose by 1.9pc over the past four weeks, compared with the same period in 2005.

Gasoline demand is under scrutiny amid the so-called US driving season, which sees vacationing Americans hit the country's highways en route to their holiday hot spots.

Crude prices have slumped in recent days on hopes that a resolution might be found to the latest upsurge in violence in the Middle East.

Prices soared after Israel launched a wide military offensive across Lebanon on July 12 after Hezbollah captured two Israeli soldiers.

Russia called on Thursday for an immediate ceasefire in the conflict, which it warned could have “catastrophic” consequences.

UN chief Kofi Annan outlined a plan to end the fighting, including a ceasefire, the early release of two captured Israeli soldiers and deployment of a peacekeeping force on the Lebanon-Israel border.

Brent had on Monday struck a record peak of $78.18 per barrel, while on July 14, light sweet crude hit an all-time high $78.40 in New York trade. —AFP