UPDATE 7-Oil prices edge higher on geopolitical concerns
* Oil supported by signs of U.S. economic growth
* Libyan protesters block oil pipeline (Updates prices to settlement, adds CFTC report)
NEW YORK, March 28 (Reuters) - Brent crude oil rose for a fourth straight session on Friday, notching its first weekly gain since February, on promising U.S. economic data and concern that possible Western sanctions on Russia's energy sector could disrupt global supplies.
The United States and NATO have voiced alarm over what they say are thousands of Russian troops massed near its western border with Ukraine. Russian President Vladimir Putin has reserved the right to send troops into Ukraine, home to a large population of Russian-speakers in the east.
U.S. crude oil rose for its third session on data showing consumer spending increased in February, lifted by an increase in services consumption, news that also buoyed the U.S. equities markets for most of the session. However, a dip in consumer sentiment this month offered confirmation that economic growth slowed in the first quarter.
Brent rose 24 cents to settle at $108.07 a barrel. U.S. crude gained 39 cents a barrel to settle at $101.67, after gaining more than $1 in each of the past two sessions.
The U.S. benchmark has been boosted by a continued drawdown in oil stocks at Cushing, Oklahoma, the pricing point for the U.S. benchmark.
"I think that some of the same factors that have pushed us back above $100 are still driving the market, and there's still increased geopolitical risk from the situation in the Crimea as Russia continues to put troops along the border with Ukraine," said Gene McGillian, an analyst with Tradition Energy in Stamford, Connecticut.
U.S. crude finished the week up 2.1 percent. Brent crude has gained nearly 1.1 percent on the week, after four consecutive weeks of losses as it retreated from February's gains on rising tensions in Ukraine.
U.S. crude's gains also outpaced Brent's for a third session, narrowing its discount to Brent CL-LCO1=R to end the session at $6.40, in from as wide as $8.03 on Wednesday.
Analysts said strong crude oil production in the U.S. was balancing out the risks of curbed supplies from Russia, the largest oil producer in the world.
"I do think the geopolitical risk play is there, but with the strong stock market and the abundant U.S. supplies, the market is being anchored somewhat from taking off," said Phil Flynn, an analyst for the Price Futures Group in Chicago, Illinois.
SUPPLY WORRIES UNDERPIN
Oil prices also continued to draw support from the Ukraine crisis, with the United States and the European Union agreeing to work together to prepare tougher economic sanctions in response to Russia's behaviour in Ukraine and to make Europe less dependent on Russian gas.
"Possible intensifying of sanctions led to higher perceived geopolitical risks by markets, hence supporting gains in benchmark crudes," Phillip Futures said in a note.
Other supply worries also underpinned prices.
In Libya, protesters have blocked a pipeline carrying around 30,000 barrels per day (bpd) of oil condensate from the southwestern al-Wafa oilfield to the Mellitah export port, state-owned National Oil Corp (NOC) said on Thursday.
NOC this week said Libya's output stood at 155,000 bpd, after the 130,000-bpd El Feel field, co-operated by Eni, had stopped producing. The 340,000-bpd El Sharara field shut weeks ago.
Libya's exports have been well below its capacity of around 1.25 million bpd since July 2013, when militias and protesters began blocking its major oil export terminals and oilfields.
Money managers cut their net long U.S. crude futures and options positions in the week to March 25, the U.S. Commodity Futures Trading Commission (CFTC) said.
The speculator group cut its combined futures and options position in New York and London by 10,399 contracts to 340,970 during the period. (Additional reporting by Peg Mackey in London, Jacob Gronholt-Pedersen; Editing by William Hardy, Dale Hudson, David Gregorio and Marguerita Choy)