Oil eased this afternoon from a record high of nearly $120 a barrel in the previous session, as traders anticipated a rise in crude oil stocks in the world's top energy consumer the United States.
US crude for June was down 48 cents at $177.59 a barrel at 11.55am. The May contract expired yesterday at $119.37, after briefly hitting an all-time peak of $119.90.
London Brent crude was down 63 cents at $115.32, after touching a record high of $116.75 the previous session.
Latest weekly fuel inventory data from the US Energy Information Administration due later today is forecast to show a 1.2 million barrel rise in crude stocks last week, while gasoline stocks are expected to have fallen by 2.3 million barrels.
Oil has surged above $100 this year in response to booming demand from emerging markets such as China plus underinvestment in new oil supplies that have contributed to a fivefold increase in prices since 2002.
Hedge funds and other investors have poured money into oil, gold and other commodities because of turmoil in equity and bond markets related to the credit crisis.
The higher prices and even the threat of a US recession have not put the brakes on oil's advance. Long-dated oil prices are above $100 a barrel out to 2016, illustrating the long-term supply constraints.
Disruptions in Nigeria have intensified the market's bullish tone.