Oil climbed back above $66 on Tuesday and France said the "price crisis" showed no sign of abating as the world's big consumers began to feel the pain.

Oil has soared about 50 percent this year on worries the industry is struggling to pump and refine enough crude.

French Prime Minister Dominique de Villepin (search) told a news conference high prices were here to stay, and he called on oil firms to plough their sizeable profits into new plants.

"This crisis, we know, is likely to last. All the factors have come together for oil to remain expensive in the years and decades to come," he said. "Our refining capacity is saturated and cannot adequately cope with French demand."

Iran's decision to press ahead with its nuclear programme in defiance of the West and rampant fuel demand in the United States have helped to fire the latest rally. Figures on Tuesday showed consumer inflation was feeling the heat.

U.S. July consumer prices rose at their fastest rate in three months and UK inflation was at its highest level since comparable records began in 1997.

U.S. crude was trading up three cents at $66.30 a barrel at 1537 GMT, below Friday's $67.10 record, while U.S. gasoline was at $1.87 a gallon. London Brent was up 12 cents at $65.70.

The relentless rise has lifted oil towards the inflation-adjusted $82 average in 1980, the year after the Iranian revolution.

The International Energy Agency's (search) chief economist told Reuters on Monday that an average $50 a barrel oil price this year would crimp economic growth by 0.8 points.

U.S. oil inventory data due on Wednesday will show how the world's biggest consumer is faring after a string of refinery problems.

"While most of the refinery plants that faced outages last week are either at or close to being back on line, the lack of spare refining capacity continues to be a worry for the market," said Barclays Capital in a report.

Iran's decision to restart uranium conversion is also holding up oil prices. The move has put OPEC's (search) second biggest producer at odds with the United Nations nuclear watchdog and the market is nervous, even though possible punitive sanctions are a long way off.

"It wouldn't be the wisest thing to impose sanctions on Iran when we need every barrel of oil they are exporting," said Mark Keenan of MPC commodity fund.

Sliding U.S. gasoline stocks at a time of peak motoring demand have sounded the alarm for oil products traders, although crude inventories have built to relatively high levels.

Crude stocks should have risen by another one million barrels last week, adding to a surplus of more than 28 million barrels over last year, a Reuters survey found.

Gasoline stocks, already in the lower half of their seasonal range, were seen dipping 1.3 million barrels with three weeks left to run in the traditional summer driving season.