VIENNA, Austria – Oil prices eased Monday but held above $73 a barrel as more than 40 million Americans were expected to take to the road for Independence Day.
Nagging concerns over Iran's nuclear defiance have helped put a high floor under prices in recent weeks.
Brent futures fell 12 cents to settle at $73.39 a barrel on the ICE Futures exchange. The New York Mercantile Exchange was closed for the U.S. holiday, and traders suggested that lack of Nymex trading kept prices from going even higher.
Worries about a supply crunch ahead of the July Fourth holiday grew after the U.S. government released a report Wednesday showing gasoline stocks shrank last week for the first time in more than two months.
Gasoline demand in the U.S. continues to rise in spite of soaring pump prices. Over the past four weeks, daily gasoline demand was up 0.9 percent from a year ago at 9.4 million barrels a day, according to Energy Department data. The average retail price of regular gasoline nationwide is $2.87 per gallon.
About 40.7 million Americans will travel 50 miles (80 kilometers) or more from home during the July Fourth holiday, up 1.2 percent from 40.2 million last year, according to projections by the AAA, the largest motor club in the United States.
Oil prices are up about 30 percent from a year ago, driven higher by strong demand and a limited supply cushion — conditions that are worrisome to traders given the backdrop of considerable geopolitical uncertainty, such as violence in Nigeria, the war in Iraq and Iran's diplomatic showdown with the West over its nuclear program.
Iran is the No. 2 producer in the Organization of Petroleum Exporting Countries, and traders are worried about the outlook for those supplies.
PVM Oil Associates in Vienna reported that OPEC powerhouse Saudi Arabia "recently cut its crude output" to 9.26 million barrels a day compared to 9.45 million barrels in the first quarter of the year.