UPDATE 6-Oil slips to $107 on weak U.S. employment data

Fri Feb 7, 2014 8:49am EST

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* U.S. jobs data rise 113,000 below the 185,000 forecast

* Tighter North Sea supplies support Brent (Recasts after non-farm payrolls data)

By Christopher Johnson and Simon Falush

LONDON, Feb 7 (Reuters) - Brent crude oil slipped to around $107 a barrel on Friday as U.S. jobs data raised concern about prospects for demand growth for the world's top oil consumer.

U.S. employers hired far fewer workers than expected in January and job gains for the prior month were barely revised up, suggesting a loss of momentum in the economy, even as the unemployment rate hit a new five-year low of 6.6 percent.

Nonfarm payrolls rose only 113,000, the Labor Department said on Friday. Economists polled by Reuters had forecast payrolls increasing 185,000 last month.

"We're still essentially going sideways with some negative momentum given what we are seeing in the emerging markets and China in recent weeks," said Simon Wardell, analyst at Global Insight.

"The jobs report just piles on to that. The direction is generally slightly down."

Brent crude was down 10 cents at $107.09 by 1340 GMT, after rising 0.9 percent in the previous session - its biggest daily gain since Jan. 22.

U.S. crude was down 40 cents at $97.44, squeezed by expectations of lower U.S. domestic demand during the peak refinery maintenance season over the next few months.

Brent's premium to the U.S. benchmark CL-LCO1=R was around $9.70 a barrel. The spread narrowed to $7.94 a barrel on Wednesday, the tightest since Oct. 10.

Tighter supply of North Sea crude in March could support the Brent benchmark. Loading of the four crude streams Brent, Forties, Oseberg and Ekofisk (BFOE) will average 890,000 barrels per day (bpd) in March, down from an expected 1.03 million bpd in February, according to loading programmes.

Investors will also keep a close eye on Saturday's talks with Iran as the U.N. nuclear watchdog hopes to persuade the Islamic state to start addressing long-held suspicions it has worked on designing a nuclear bomb.

Tough international sanctions over the past two years have cut Iran's oil exports in half. (Additional reporting by Ron Bousso and Jacob Gronholt-Pedersen in Singapore; Editing by William Hardy)

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