* US oil set to post biggest weekly fall since June
* White House presses Senate to delay new Iran sanctions
* Coming Up: U.S. durable goods data at 1230 GMT
(Updates prices; paragraphs 1, 4-5)
By Christopher Johnson
LONDON, Oct 25 (Reuters) – Brent crude oil slipped further
below $107 a barrel on Friday on concerns about higher supply
and faltering demand, despite signs of faster economic growth in
major consumer China.
Worries that the escalating war in Syria could disrupt
Middle East oil supplies pushed Brent to a six-month high above
$117 in August. But prices have dropped more than $10 a barrel
since then and some analysts see further falls ahead.
U.S. light crude oil has been depressed by a seasonal dip in
demand and increasing domestic oil production that has boosted
stockpiles, particularly on the U.S. Gulf coast.
Brent crude for December was down 9 cents a barrel
to $106.90 by 1020 GMT, or nearly 3 percent lower on the week,
falling for a third day.
U.S. crude oil was up 40 cents at $97.51, although
still down around 3.5 percent on the week, its biggest weekly
loss since June.
“We are seeing some consolidation after several days of
falls,” said Commerzbank senior oil and commodities analyst
Carsten Fritsch in Frankfurt.
“But the fact that prices have not bounced back is quite
bearish. The risks are still to the downside.”
Oil supplies have improved in recent weeks with higher
output from several producers in the Middle East and North
Africa and several analysts see oil heading lower.
“Balances are not as tight as we, or the market, had
expected,” said Virendra Chauhan, oil analyst at London-based
consultancy Energy Aspects.
“The worst of this year’s supply shortfalls is now behind
us, with maintenance at non-OPEC fields largely complete and
some of the lost OPEC production also coming back in Libya,
Nigeria and Iraq,” Chauhan added.
Oil markets found some support from Chinese data on Thursday
pointing to faster economic growth in the world’s second-biggest
oil user.
China’s factory output expanded at its fastest pace in seven
months in October as policymakers sought to ensure a steady,
broad-based recovery.
In the United States, while overall manufacturing fell last
month, investors expect oil demand to recover as peak winter
demand sets in.
But fading geopolitical risk is curbing speculative interest
in oil with signs of a possible rapprochement between Iran and
the West raising expectations of some easing of sanctions
against the Islamic state.
The White House hosted a meeting of aides to Senate
committee leaders on Thursday trying to persuade lawmakers to
hold off on a package of tough new sanctions against Iran.
This had been expected to come to a vote in the Senate
Banking Committee last month but was held back after appeals
from President Barack Obama’s administration to let negotiations
on Iran’s nuclear programme get under way.
Diplomats say sanctions against Iran are likely to stay in
place for some time, even if there is progress in talks over
Tehran’s disputed nuclear programme. But any signs of a deal,
with an eventual return of Iranian oil to world markets, would
have a negative impact on prices, analysts say.
“The prospect for 2014 is already of a big surplus, and, on
top of that, there is the chance of a return to the market of
more Iranian oil – barrels no one needs,” Commerzbank’s Fritsch
said.
(Additional reporting by Manash Goswami in Singapore; Editing
by Susan Fenton)
UPDATE 4-Oil slips below $107 as supply improves
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