* Oil prices climb around 3%

* Tehran said it was reviewing Washington's latest

responses

* Gold has fallen more than 14% since the war began

(Updates prices for Europe mid-session trade)

By Anjana Anil

May 21 (Reuters) - Gold eased on Thursday, pressured by

a stronger U.S. dollar and high Treasury yields, while stagnant

peace talks in the Middle East kept oil elevated, inflation

concerns alive, and reinforced bets of higher interest rates.

Tehran said it was reviewing Washington's latest responses,

and President Donald Trump suggested he could wait a few days

for "the right answers" from Tehran but was also willing to

resume attacks on the country.

Spot gold was down 0.6% at $4,517.94 per ounce, as of

1118 GMT. On Wednesday, bullion rose more than 1% in U.S.

trading hours after having hit its lowest level since March 30.

U.S. gold futures for June delivery lost 0.4% at

$4,518.70.

"No surprise that gold remains mired around the mid-$4k

region, as the U.S. dollar retains much of its gains since the

Middle East conflict began, while inflation woes are still

palpable across global financial markets," said Han Tan, chief

market analyst at Bybit, adding that the hawkish bias in the

latest FOMC minutesfurther limited gold's upside.

The yellow metal has fallen more than 15% since the war

began in late February, as energy-driven inflation woes forced

it to adopt an inverse relationship with oil prices. The

benchmark Brent crude was last up around 3% at $107.4 a barrel.

"As long as the geopolitical equation remains uncertain,

gold bulls are likely to struggle to gather any upside momentum

of note, especially if rate hikes loom large," Tan added.

The dollar's rise makes greenback-priced bullion expensive

for other currency holders, while the U.S. 10-year Treasury bond

yield resumed its climb, increasing the opportunity cost of

holding non-yielding bullion.

Despite being an inflation hedge, gold struggles in an

elevated interest rate environment.

Spot silver was down 1.4% at $74.96 per ounce,

platinum lost 1% to $1,931.05 and palladium fell

0.9% to $1,357.94.