Oil prices fall in Asia on Fed chief's comments

World oil prices fell in Asian trade early on Wednesday in reaction to US Federal Reserve chairman Ben Bernanke's comments about inflation, dealers said.

In early morning trade, New York's main contract, light sweet crude for July delivery eased 30 cents to 124.01 dollars a barrel from 124.31 dollars at the close of floor trading on Tuesday in the United States.

New York oil prices had fallen a hefty 3.45 dollars Tuesday after the Fed chairman said the US central bank was being "attentive" to the sagging dollar because of its potential impact on inflation.

London's Brent North Sea crude for July delivery lost 43 cents to 124.15 dollars a barrel.

"The days of establishing new record prices appear to be temporarily over," said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.

"The market is now really reacting to the comments made by the US Federal Reserve yesterday regarding his concerns on inflation," he said.

Oil prices have now lost around 11 dollars since striking record peaks of 135.14 dollars in London and 135.09 dollars in New York on May 22.

Bernanke, speaking via satellite from Washington to a monetary conference in Barcelona, Spain, offered a mixed assessment of US economic conditions, while highlighting concerns about inflation and the dollar.

He also said oil price rises "pose additional downside risks to growth."

Meanwhile, Kuwait's Oil Minister Mohammad al-Olaim said the Organisation of Petroleum Exporting Countries was prepared to pump more crude if necessary.

"OPEC is prepared to increase supplies only if the market needs it," Olaim said in statements reported by the official KUNA news agency.

Kuwait is Opec's fourth largest oil producer, pumping around 2.5 million barrels per day.

Opec produces 40 percent of the world's oil. Its current output stands at about 32 million barrels per day.

The cartel has repeatedly brushed aside international demands to increase output in the past six months, blaming speculative traders and the falling dollar for record-breaking oil prices.