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Snowed in: thigh-high snow surrounds the White House

Oil holds steady around $71

Oil held above $71 a barrel today, supported by a weaker US dollar and as some investors viewed the previous session's decline to a near two-month low as a buying opportunity.

Metals including copper and gold also rose, although European shares turned negative after an earlier rally as banking stocks were dragged down by worries over euro zone sovereign debt problems.

US crude for March was up 38 cents at $71.57 a barrel by 1139 GMT. The contract fell as low as $69.50 on Friday, the lowest since 15 December. Brent crude rose 36 cents to $69.95.

"We dipped below $70 on Friday, which is the bottom of the recent trading range, and some used that as a buying opportunity," said analyst at Commerzbank, Carsten Fritsch, to Reuters, referring to US crude.

"Given weak fundamentals and doubts about economic recovery, it's only a matter of time before prices start heading lower again."

A cold snap in the US mid-Atlantic region, an area heavily dependent on home heating oil and natural gas supplies, and escalating tensions between Iran and western nations also lent support to prices.

The US dollar was weaker against a basket of currencies. Dollar weakness makes crude and other dollar-priced commodities cheaper for holders of other currencies, and tends to support oil prices.

Major commodity markets are testing 200-day moving averages after sharp sell-offs in the past three weeks, but that important support level appears to have held for US crude, as well as copper and gold.

"For now, we would venture to say that a measure of stability could be with us over the next day or two," said Edward Meir, analyst at MFGlobal, in a report.

"However, most charts still look precarious and at best, rallies could return values back over broken trend lines with little assurance that these gains will be sustained."

A blizzard dumped 0.5 metres of snow across much of the US mid-Atlantic on Saturday, threatening record snowfall and leaving tens of thousands without power.

The US and Germany have threatened carefully targeted new sanctions against Iran, which gave instructions on Sunday for the production of higher-grade nuclear reactor fuel.

Oil fell 2.7% on Friday as a tepid employment report in the US, the world's top energy consumer, heightened worries of a sluggish recovery in fuel demand. It has lost nearly 10% this year.

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