Oil steady near $70 as US growth worries ebb

LONDON, June 16 (Reuters) Oil held steady near a barrel on Friday as investors grew more optimistic about economic growth and energy demand in the U.S., the world's top oil consumer.

Precious metals including gold rose and equities rallied after U.S. Federal Reserve Chairman Ben Bernanke on Thursday toned down his warnings against U.S. inflation, and said oil prices had had a limited impact on the economy.

''People are choosing to interpret them (Bernanke's remarks) as slightly more doveish than some of his previous comments,'' said Tony Dolphin of Henderson Global Investors, which manages more than 67 billion pounds (4.3 billion).

''Yes, growth is slowing. It's not actually falling off a cliff at the moment.'' U.S. light sweet crude rose 23 cents to .73 by 1030 GMT, gaining for a third consecutive day. London's Brent crude was down 7 cents at .38 a barrel.

Commodities and oil fell earlier this week on worries that inflation would lead to higher interest rates, slowing economic growth and energy demand.

Oil in New York has largely kept between to since early May having hit a .35 record high in April, and analysts see little to push prices outside that range.

''I don't think there's anything right now to give the market a clear direction to break out of that band,'' said Gerard Burg, minerals and energy economist at National Australia Bank.

U.S. INVENTORIES The rebound earlier this week was also aided by data on Wednesday showing a fall in U.S. crude inventories as refineries ramped up operations to meet peak gasoline demand in summer.

Overall, oil prices are up nearly 15 percent up so far this year and stand at their highest, in real terms, since 1980. They have surged from a barrel at the start of 2002.

The focus remains on Iran, the world's fourth largest oil exporter, which has yet to respond formally to incentives offered by world powers to end a stand-off over its atomic work.

In Shanghai on Friday, Iran's President Mahmoud Ahmadinejad said the offer was a positive step, but gave no hint as to when he might formally respond. He also met with his counterpart in China, which opposes a push toward U.N. sanctions.

The West believes Iran's uranium enrichment could be used to make nuclear weapons, but Tehran insists it is purely for energy generation and civilian use.

REUTERS CS DS1632