UPDATE 14-Oil falls 2 pct, U.S. consumer confidence weighs

                                
 * U.S. consumer confidence, British GDP down sharply
                                
 * U.S. crude inventory data eyed on Tuesday, Wednesday
                                
 * Dollar gains, equities fall in bout of risk aversion
 (Updates 2nd-quarter percentage gain in 9th paragraph)
                                
 NEW YORK, June 30 (Reuters) - Oil prices fell 2 percent to
below $70 a barrel on Tuesday after a drop in U.S. consumer
confidence data in May added to concerns over a potential
economic rebound.
                                
 Major stock market indexes also turned lower and the dollar
rose after the Conference Board's consumer confidence index
showed households felt worse about their situation, fueling a
bout of risk aversion.
                                
 Other gloomy economic data showed the British economy
shrank at its fastest pace in more than 50 years in the first
three months of 2009 and has been in recession for a whole
year.
                                
 In addition, jobless rates in No. 3 oil consumer Japan rose
to a new 5-1/2-year high in May and job availability sank to a
record low, further damping hopes for an economic recovery.
                                
 U.S. crude <CLc1> settled down $1.60 at $69.89 a barrel,
after earlier rising to an eight-month high of $73.38. London
Brent <LCOc1> gave up $1.69 to settle at $69.30 a barrel.
                                
 "The consumer confidence number really seemed to reverse
momentum," said Phil Flynn, analyst at PFGBest Research in
Chicago.
                                
 "It's before July 4th (U.S. holiday) weekend and it got the
market scared everyone is going to stay home and not drive.
When the market gets concerned about the economy, people run
back to the dollar to avoid risk."
                                
 The U.S. dollar rose against the euro, weighing on
commodities denominated in the greenback, with the
Reuters-Jeffries CRB index <.CRB> commodity benchmark trading
down 1.70 percent on Tuesday afternoon.
                                
 Driven by hopes of a global economic recovery, oil prices
rose more than 40 percent in the second quarter, the highest
quarterly percentage gain since 1990.
                                
 Earlier, oil prices surged on unusually high Asian trading
volumes, which some traders attributed to big fund players in
the market.
                                
 Oil markets were also awaiting U.S. inventory data from the
American Petroleum Institute, due Tuesday afternoon, expected
to show a draw in crude stockpiles and a build in product
inventories as the world's top consumer heads into the July 4
U.S. Independence Day holiday weekend.
                                
 A revised Reuters poll of analysts ahead of weekly data
estimated U.S. crude stockpiles fell by 2 million barrels last
week, while gasoline stocks were seen up 1.9 million barrels
and distillate stocks up 1.5 million barrels.
                                
 The U.S. Energy Information Administration will release its
weekly inventory report on Wednesday.
 (Reporting by Matthew Robinson, Robert Gibbons, and Gene Ramos
in New York; Joe Brock in London; Editing by Walter Bagley)