•Global crude futures stabilized early Tuesday, falling back slightly from strong gains seen on Monday but nonetheless remaining high, with July ICE Brent hovering around $70/barrel.

•Crude prices rallied on Tuesday on the back of technical-driven buying and supply concerns surrounding cyclone Gonu, which is approaching Oman. A surge in natural gas and heating oil due to expectations of hot weather also pushed crude prices higher.

•At 0914GMT, July ICE Brent was unchanged from Monday at $70.40/b, while July NYMEX WTI inched down 32 cents to $65.89/b. "Prices are drifting sideways this morning and it seemed like Monday's bullish factors such as cyclone fears close to Oman have lost their power to push prices higher," a broker said. "Front month RBOB is much weaker, which is likely to drag down prices," he added.

•Cyclone Gonu is expected to reach the coast of Oman some time Tuesday afternoon. However, the Oman Meteorological Department expects the cyclone to be much weaker by the time it hits land and is not expecting too much damage to housing and infrastructure. With regard to shipping in the area, the Department sees no threat to traffic passing through the Straits of Hormuz.

Updated: June 5, 2007