UPDATE 4-Gold prices jump 1 pct as oil hits record high

                                
 (Updates prices, adds ETF holdings)
                                
 By Lewa Pardomuan
                                
 LONDON, May 20 (Reuters) - Gold rose to its highest level in
almost a month on Tuesday as record-high oil prices fuelled
fears of accelerating inflation, but a drop in global demand for
the precious metal caused some concern.
                                
 Demand for gold for jewellery, investment and other uses,
fell 16 percent compared with a year ago to 701 tonnes in the
first quarter of 2008 -- the lowest quarterly figure in five
years -- as bullion hit a record above $1,000 an ounce, the
World Gold Council said in a report. [ID:nL19678201]
                                
 Spot gold <XAU=> hit a high of $919.60 an ounce, its highest
level since April 23, up from $905.00/906.40 an ounce late in
New York on Monday. 
                                
 "Obviously the worries about inflation continue and are
getting worse," said Daniel Hynes, metals analyst at Merrill
Lynch.
                                
 "We think there will be more bad news coming out of the
woodwork in terms of the global economic picture, which should
help the gold market. I think consumers have to catch up a bit
with where we are now."
                                
 Oil <CLc1> jumped to a new record above $129 a barrel on
Tuesday, spurred by strength in refined oil products markets,
led by diesel as well as a weak U.S. dollar.[ID:nSP39569]
                                
 Gold holdings in the world's largest exchange-traded funds
(ETF) for bullion, StreetTRACKS Gold Shares <XAUEXT-NYS-TT>,
were unchanged at 583.93 tonnes after a sharp drop last week --
still down from a record of 663.83 tonnes in mid-March.
                                
 Gold has lost more than 12 percent in value since spiking to
a record high of $1,030.80 on March 17, on profit taking and a
recovery in the U.S. dollar against other currencies. But high
oil prices, which raises fears of inflation, may offer support.
                                
 Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange added $12.1 to $917.9 an
ounce in electronic trading.
                                
 Gold's gains and record high oil prices also spurred buying
in platinum but the metal was still below a two-month high at 
$2,174 hit on Monday ahead of an outlook report by refiner
Johnson Matthey <JMAT.L>.
                                
 Platinum <XPT=> rose to $2,143.50/2,163.50 an ounce from
 $2,139.50/2,159.50 in New York.
                                
 Sentiment was bullish, with Johnson Matthey expecting the
platinum market to close 2008 in a significant deficit due to
output shortfalls. [ID:nL15825991].
                                
 "With ongoing power shortages likely, we would not be
surprised to see platinum prices continue to rally over the
months ahead during the South African winter," investment bank
Fairfax said in a report.
                                
 Platinum struck a record high of $2,290 an ounce on March 4
after a power crisis in main producer South Africa disrupted
mining and sparked fear of a supply deficit.
                                
 Spot silver <XAG=> rose to $17.44.17.50 an ounce from
$16.99/17.05 late in New York. Palladium <XPD=> dropped to
$441.50/449.50 an ounce from $444/452 an ounce.
                                
 (Editing by Christopher Johnson)