CORRECTED-Brent slips below $110 on Fed policy concerns; Egypt supports
(Corrects paragraph 8 to say expectations for U.S. crude stocks support, not weigh on prices)
* Investors fear Egypt unrest could affect supply
* Libyan oil exports near lowest since 2011 civil war
* Coming up: API inventory data at 2030 GMT
* Coming up: EIA data, Fed policy minutes on Wednesday
By Jessica Jaganathan
SINGAPORE, Aug 20 (Reuters) - Brent crude prices slipped below $110 a barrel on uncertainty over when the U.S. Federal Reserve will scale back its bond-buying program, but unrest in Egypt and reduced oil product supply from Libya kept a floor under prices.
Brent crude oil futures for October fell 24 cents to $109.66 a barrel by 0215 GMT, down from a four-month peak of $111.53 on Aug. 15.
U.S. crude oil futures for September fell 7 cents to $107.03.
Investors are waiting on minutes from the U.S. central bank's latest policy meeting, due Wednesday, which could provide fresh clues on when the Fed plans to taper its monthly $85 billion in asset purchases, which many believe could begin next month.
"There's some book-squaring going on prior to the FOMC minutes on Wednesday as well as Chinese flash PMI numbers on Thursday," said Ric Spooner, chief market analyst at CMC Markets in Sydney.
"The market remains well supplied so we've arrived at a level where traders are starting to get a bit more concerned about the downside risks if there's potentially any increase in the U.S. dollar as a consequence of what the Fed does which would represent a negative for oil prices."
The HSBC China flash manufacturing PMI data will be scrutinised for clues on demand in the world's second largest oil consumer.
Supporting oil prices, U.S. commercial crude inventories likely fell last week by 1.4 million barrels, an initial poll of Reuters analysts showed, ahead of the release of weekly data.
Industry group API is set to release its stockpile report on Tuesday at 2030 GMT. The U.S. Energy Information Administration issues its data on Wednesday at 1430 GMT.
MIDDLE EAST UNREST
Egyptian security forces have arrested the top leader of the Muslim Brotherhood, state media reported on Tuesday, pressing a crackdown on his group.
Almost 900 people, including more than 100 soldiers and police, have been killed since last week in clashes pitting the followers of deposed Islamist President Mohamed Mursi against the army-backed government.
Egypt is not a major oil producer, but investors worry that unrest there could spread throughout the Middle East, which pumps more than a third of the world's oil.
"There's already a risk premium built in for Egypt so I think overall the position of the market is downward, and there will probably only be more risk premium added into prices if there are possible moves to threaten cargo moves in the Suez canal or the pipeline," Spooner said.
Libya was forced to suspend contractual obligations with a force majeure on some oil exports on Monday, acknowledging weeks of disruption which has cut shipments to their lowest since the civil war of 2011.
About half of Libya's over 1.2 million barrel per day export capacity remains shut down, industry sources said.
Goldman Sachs said on Monday it expected tighter oil markets to propel Brent to $115 "in the very near term". (Editing by Richard Pullin)