US Treasury Secretary Henry Paulson has warned that high oil prices threaten to prolong his country's economic slowdown, and has urged oil producers to raise output.

"This is a very, very important issue because the high price of oil is creating economic issues...and is a heavy burden for people around the world," Paulson said at a press conference with Mexican Finance Minister Agustin Carstens ahead of a conference of Latin American finance chiefs.

"In my judgment, it's got a very real risk of prolonging this economic slowdown, but this is not a situation that avails itself to a quick fix.

"We call on oil producers everywhere to open up for investment...and then obviously this is about developing alternative sources of energy, new technologies," Paulson said.

Prices were calmer today after two days of rises with militant attacks in Nigeria and Israeli-Iranian tension adding to the general upward pressure.

US August crude rose three cents at $136.77 a barrel and Brent down 17 cents at $135.74.