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US strikes failed to destroy Iran's nuclear sites, report

says

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Prices settled at multi-week lows in previous session

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Coming up: US EIA data on crude and fuel stockpiles

(Updates with analyst quotes and prices as of 0341 GMT)

By Stephanie Kelly and Trixie Yap

June 25 (Reuters) - Oil prices climbed on Wednesday as

investors assessed the stability of a ceasefire between Iran and

Israel, but held near multi-week lows on the prospect that crude

oil flows would not be disrupted.

Brent crude futures rose 85 cents, or 1.3%, to

$67.99 a barrel at 0341 GMT, while U.S. West Texas Intermediate

(WTI) crude gained 87 cents, or 1.4%, to $65.24.

Brent settled on Tuesday at its lowest since June 10 and WTI

since June 5, both before Israel launched a surprise attack on

key Iranian military and nuclear facilities on June 13.

Prices had rallied to five-month highs after the U.S.

attacked Iran's nuclear facilities over the weekend.

"Global energy prices are moderating following the

Israel-Iran ceasefire. The base case for our oil strategists

remains anchored by fundamentals, which indicate sufficient

global oil supply," said JP Morgan analysts in a client note.

U.S. airstrikes did not destroy Iran's nuclear capability

and only set it back by a few months, according to a preliminary

U.S. intelligence assessment, as a shaky ceasefire brokered by

U.S. President Donald Trump took hold between Iran and Israel.

Earlier on Tuesday, both Iran and Israel signalled that the

air war between the two nations had ended, at least for now,

after Trump publicly scolded them for violating a ceasefire.

As the two countries lifted civilian restrictions after 12

days of war - which the U.S. joined with an attack on Iran's

uranium-enrichment facilities - each sought to claim victory.

"The Israel-Iran ceasefire is likely to prove fragile. But

so long as both parties show themselves unwilling to attack

export-related energy infrastructure and/or disrupt shipping

flows through the Strait of Hormuz, we expect bearish

fundamentals in the oil market to continue ... from here," said

Capital Economics chief climate and commodities economist David

Oxley.

Direct U.S. involvement in the war had investors worried

about the Strait of Hormuz, a narrow waterway between Iran and

Oman, through which between 18 million and 19 million barrels

per day (bpd) of crude oil and fuel flow, nearly a fifth of

global consumption.

Investors awaited U.S. government data on domestic crude and

fuel stockpiles due on Wednesday.

Industry data showed U.S. crude inventories fell by 4.23

million barrels in the week ended June 20, market sources said,

citing American Petroleum Institute figures on Tuesday.