(Bloomberg News) Oil rebounded from a seven-month low as world powers and Iran struggled to overcome disagreements at their second round of meetings on the country's nuclear program.

Prices climbed as much as 1.6 percent after a member of the Iranian delegation said the meeting in Baghdad made no progress. Chinese, French, German, Russian, U.K. and U.S. negotiators -- the so-called P5+1 group -- are pressuring Iran to immediately halt production of uranium enriched to 20 percent, according to U.S. and European diplomats at the talks.

"There are some concerns that the Iranian talks are not going as well as some people had hoped," said Phil Flynn, an analyst at futures brokerage PFGBest in Chicago. "It doesn't sound like there is going to be a quick resolution and the geopolitical uncertainty is back in the marketplace."

Crude for July delivery gained 92 cents, or 1 percent, to $90.82 a barrel at 9:33 a.m. on the New York Mercantile Exchange. It's only the fourth time prices have risen this month. Futures settled at a seven-month low of $89.90 a barrel yesterday.

Brent oil for July settlement rose 93 cents, or 0.9 percent, to $106.49 a barrel on the London-based ICE Futures Europe exchange.

"There's been no progress in this round of talks," Taleb Mahdi, a member of the Iranian delegation, said in an interview in Baghdad today. The P5+1 offer calls on Iran to end all uranium enrichment, he said.

Baghdad Talks

"If there wasn't progress, we wouldn't still be holding talks," Michael Mann, spokesman for Catherine Ashton, the European Union's foreign policy chief, told reporters in Baghdad. "Progress has been made."

The meeting was held in an effort to prevent possible military strikes against Iran, a prospect Israel hasn't ruled out. The first round of discussions was held April 14 in Istanbul.

"This is a very calculated negotiation by Iran," said Rich Ilczyszyn, chief market strategist and founder of Iitrader.com in Chicago. "Any hair-trigger comments and the market will spike."

The negotiators yesterday had the most detailed discussions since the latest meetings began in February, according to a senior U.S. official who spoke on condition of anonymity because of the talks' sensitivity.

While the Islamic republic, target of a probe by the United Nations International Atomic Energy Agency since 2003, denies it wants to make nuclear weapons, it has refused to fully cooperate with inspectors and has been hit with international sanctions.

Iran produced an average of 3.28 million barrels a day of crude in April, according to estimates compiled by Bloomberg. Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries, pumped 9.8 million a day.

Prices reduced gains earlier after data showed orders for computers, machinery and other capital equipment dropped in April for a second month, pointing to a slowdown in U.S. business investment.