Brent slips toward $110 as US fiscal cliff deadline draws near

* Jitters about looming U.S. budget deadline cap oil prices

* Brent set to average above $111/bbl in 2012, vs $110.91 last year

* U.S. crude 2012 average at $94/bbl, down from $95.11 in 2011

By Florence Tan

SINGAPORE, Dec 31 (Reuters) - Oil slipped on Monday for a third straight session, with Brent holding above $110 per barrel, on worries the United States may not reach a deal by Jan. 1 to prevent a fiscal crisis that could erode fuel demand at the world's largest oil consumer.

Democrats and Republicans remained at loggerheads on Sunday over a deal that would prevent the United States from tumbling over a "fiscal cliff" of sharp spending cuts and higher taxes for all Americans.

While analysts are optimistic there will be a breakthrough in U.S. talks, the lack of a deal yet with the deadline just a day away is keeping a ceiling on prices of riskier assets.

Brent crude fell 30 cents to $110.32 a barrel by 0234 GMT after hitting a low of $110.08 earlier in the session. U.S. crude was at $90.59, down 21 cents.

Brent is headed for a fourth straight yearly gain and set to log a record high annual average settlement price, while U.S. crude was on track for a drop this year after three consecutive annual gains.

"The market is nervous about it," said Jonathan Barratt, chief executive officer at Barratt's Bulletin, a Sydney-based research firm, referring to the so-called U.S. fiscal cliff. But "at the end of the day a deal would be done," he said.

He added that the optimism has kept Brent trading at the top of a price range between $100 and $110 a barrel.

The next hurdle for the U.S. government would be to raise its debt ceiling in the next few weeks to avert a default that may lead to another credit downgrade and cause panic in the financial markets.

In China, the world's second-largest economy, factory activity expanded at its fastest rate in December since May 2011, reinforcing signs of a steady recovery.

HIGHEST AVERAGE BRENT PRICE EVER

Front-month Brent is set to log a record high average settlement price at more than $111 a barrel this year. Supply worries stemming from Middle East tensions and disruptions in the North Sea have helped oil prices shrug off headwinds from a global economic slowdown that has cut oil demand.

Brent hit a high of $128.40 a barrel in March and slipped to a low of $88.49 in June.

Slow economic growth and ample supplies are expected to keep a lid on oil next year with crude prices gradually slipping lower. Brent crude will average at $108 a barrel in 2013, a Reuters monthly survey of 26 analysts showed.

The United States is pumping the most oil in 19 years after shale oil discovery pushed production to nearly 7 million barrels per day while its crude imports slipped to the lowest in 12 years, government data showed.

World's top oil exporter Saudi Arabia expects production hikes by other oil producers to weigh on energy prices in 2013, potentially cutting into the country's fiscal surplus.

But geopolitical tensions in the Middle East are expected to underpin oil prices.

On Friday, Iran started six days of naval drills in the Strait of Hormuz, a vital oil and gas shipping route, the official IRNA news agency reported.

Iran has previously threatened to disrupt or close the waterway if its nuclear sites are subjected to military attack by Israel or the United States. (Editing by Himani Sarkar)

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Brent crude ends down as US fuel stocks rise

NEW YORK | Fri Dec 28, 2012 3:22pm EST

NEW YORK Dec 28 (Reuters) - Brent crude futures edged lower in thin, choppy trading on Friday, pressured by data showing U.S. fuel stockpiles rose sharply and crude stocks fell less than expected last week, as traders awaited news on fresh U.S. budget talks that might avert looming tax hikes and spending cuts.

Brent February crude fell 18 cents, or 0.16 percent, to settle at $110.62 a barrel, having traded from $109.83 to $111.38.

For the week, Brent rose $1.65, or 1.5 percent. (Reporting by Robert Gibbons)

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Brent slips to $110, stalled US fiscal talks dent demand outlook

* U.S. crude and distillate stocks fall, capping oil price loss

* Promising German data supports sentiment

By Jessica Jaganathan

SINGAPORE, Dec 20 (Reuters) - Brent crude slipped on Thursday to trade near $110 a barrel as investors took profits from recent gains after talks to avert a U.S. fiscal crisis stalled, stoking worries about demand from the world's biggest oil consumer.

As a year-end deadline nears, U.S. President Barack Obama and House of Representatives Speaker John Boehner remained locked in intense bargaining over a possible deal to avoid the so-called fiscal cliff of harsh tax hikes and automatic spending cuts that could badly damage an already weak economy.

Significant progress seemed to have been made earlier this week with both Obama and Boehner offering substantial concessions, but talks turned sour again with Obama accusing opponents of holding a personal grudge against him while the top Republican negotiator called the president "irrational".

"Negotiations are (not progressing) which is probably why we're seeing a sell-off today and the risk sentiment coming off," said Natalie Rampono, a commodities analyst at ANZ in Melbourne. "The markets are being directed by sentiment from the U.S. fiscal cliff talks and so that will have the biggest influence on prices at the moment."

Brent crude slipped 35 cents to $110.01 a barrel by 0340 GMT, after settling $1.52 higher in the previous session which was the biggest one-day gain since Nov. 19.

U.S. oil fell 40 cents to $89.58.

While investors still believe the United States will be able to avert a fiscal crisis, oil prices and other riskier assets will remain under pressure as the deadline comes closer with no signs of a deal yet.

However, a patch of promising data from Germany and the United States kept a floor under prices.

Morale at German businesses climbed in December as their confidence in the outlook rose at its fastest rate in 2-1/2 years, boosting hopes Europe's largest economy will bounce back quickly after a weak end to 2012.

Also adding to positive sentiment was data showing U.S. homebuilding permits touched their highest level in nearly 4-1/2 years in November.

Investors are now eyeing weekly U.S. data on jobless claims due later on Thursday for further clues on the country's economic health.

U.S. STOCKS DRAWDOWN SUPPORTS

Oil prices also found early support from a drop in U.S. crude oil and distillate stocks.

Crude stocks fell by 964,000 barrels to 371.65 million barrels, compared with an average analyst forecast for a 1.1 million barrel drawdown in a Reuters poll. Crude imports fell 101,000 barrels per day (bpd) to 8.36 million bpd.

Distillates, which include diesel and heating oil, fell 1.09 million barrels to 116.97 million barrels, versus analyst expectations for a 1 million-barrel build.

"Oil prices could get a little bit of support ... in the slight pick up in heating oil demand with the drop in distillate inventory being greater than expectations ... So if product prices increase, that could sometimes influence oil market sentiment," Rampono said.

Oil prices could also be underpinned by a little-noticed provision in U.S. sanctions against Iran beginning in February that is likely to trap payments abroad for its oil exports running into billions of dollars.

The provision could halt most of the flow of petrodollars to Iran, given that the value of its oil exports is far higher than what it imports from its biggest customers - China, South Korea, India and Japan.

Sanctions on financial transactions with Iran have already made it difficult for buyers to pay for oil from the OPEC producer, triggering supply worries and supporting oil prices. (Editing by Himani Sarkar)

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Brent above $108 on hopes of US budget crisis resolution

* U.S. crude stocks drop, oil products mixed last week -API

* Global shares, euro rally on hopes for U.S. budget deal

* Brent approaching resistance at $109.02/bbl - technicals

* Coming up: EIA weekly oil inventories at 1530 GMT

By Manash Goswami and Florence Tan

SINGAPORE Dec 19 (Reuters) - Brent futures held steady above $108 a barrel on Wednesday, tracking a rally in most other risk assets on expectations a budget crisis in the United States will be resolved, saving the world's top oil consumer from slipping into recession.

Asian shares rose, following a rally in U.S. equities, and the euro hovered around multi-month highs on growing investor confidence of an agreement on spending and taxes between the White House and Republicans before the year-end deadline. Oil may get additional support if U.S. inventory data is close to that of an industry group that showed a sharp drawdown.

Brent crude slipped 1 cent to $108.83 a barrel by 0150 GMT, after settling $1.20 higher. U.S. oil slipped 2 cents to $87.91, after ending 73 cents higher and breaking above the 50-day moving average of $87.64.

"There is more upside potential for Brent because of a revival in the overall economic outlook," said Yusuke Seta, a commodities sales manager at Newedge Japan.

"Supporting factors are prevailing over negative factors."

Political manoeuvring intensified over an agreement to keep the U.S. economy from tumbling off the "fiscal cliff" next year as Republicans tried to wring more tax-rate concessions out of the White House on Tuesday.

Brent is approaching a resistance at $109.02 per barrel, according to Reuters technical analyst Wang Tao. U.S. oil faces a resistance zone of $88.28-$88.37 and is expected to retrace to $86.80, he said.

Data from the American Petroleum Institute showed U.S. crude stocks fell more than expected in the week to Dec. 14 as imports dropped and refined product stocks were mixed as processing rates rose.

Crude stocks fell by 4.1 million barrels against a forecast 1.1 million barrel drawdown in a Reuters poll. Gasoline stockpiles across the country rose by 4.2 million barrels last week compared with an expectation of a 1.8 million barrel build. Investors are now awaiting inventory data due later in the day from the Energy Information Administration (EIA).

"Oil may get additional support if the U.S. government data on stockpiles confirm what the industry data API has said," Newedge's Seta said. (Reporting by Manash Goswami; Editing by Ed Davies)

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