* Frigid winter boost heating oil demand in US, Europe
* Libya PM threatens force to re-open eastern oil ports
* U.S. economy loses steam as manufacturing slows in January
By Florence Tan
SINGAPORE, Feb 4 (Reuters) - Brent hovered at around $106 a barrel on Tuesday as a frigid winter boosted heating oil demand in Europe and the United States, offsetting weak economic data from the US and China.
Supply cuts in Libya and in the North Sea also limited losses for Brent. Bad weather reduced output from Libya while Prime Minister Ali Zeidan stepped up the pressure on protesters blocking eastern ports on Monday, telling them he had weeks ago ordered troops to prepare to move there to end their blockade.
March Brent crude edged down 6 cents to $105.98 a barrel by 0322 GMT after two straight sessions of losses. U.S. crude inched up 13 cents to $96.56 a barrel following its largest daily percentage loss in nearly a month as it tumbled with U.S. equities.
"Oil fundamentals seem supported in the short term because OECD distillates inventories are low," Tony Nunan, a risk manager at Mitsubishi Corp in Tokyo said.
U.S. distillate stocks, including heating oil and diesel fuel, were forecast to have fallen 2.2 million barrels on average last week, a preliminary Reuters poll of analysts showed. U.S. commercial crude oil and gasoline stockpiles were forecast to have risen last week.
The next support for West Texas Intermediate (WTI) crude is at $96 a barrel, Nunan said.
"The support for WTI is more constructive as they really had a cold winter," Nunan said, adding that two more snowstorms were forecast to hit the United States, while the start-up of new pipeline capacity is reducing a supply glut at the contract's delivery point in Cushing, Oklahoma.
Oil is also gaining support from tighter supply in the North Sea as the Buzzard oilfield, the largest field that contributes to Forties, has had a new output glitch.
ECONOMIC WOES DRAG
Slowing economic growth in the U.S. and China raised concerns about fuel demand at the world's largest oil consumers while forecasts of excess supply this year weigh on oil prices.
The U.S. economy has lost steam as manufacturing activity slowed sharply in January on the back of the biggest drop in new orders in 33 years, while construction spending barely rose in December, adding to concern about growth in China.
"The macroeconomic picture looks bad and that's why equities are weak. The so called risk-off trade is in vogue now," Nunan said, adding that the Federal Reserve's decision to further reduce its bond purchases has compounded problems at emerging economies.
(Reporting by Florence Tan; Editing by Michael Perry)