* U.S. fiscal cliff back in focus after election
* Europe worries revived, Draghi says economy to stay weak
* Coming Up: ECB rate decision at 1245 GMT
By Ramya Venugopal
SINGAPORE, Nov 8 Brent crude rose above $107 per
barrel in Asia on Thursday as an almost 4 percent slump in the
previous session, its biggest fall in about a year, lured in
some buyers although worries on the U.S. fiscal cliff and
Europe's woes kept a lid on gains.
Oil led a slump in commodities on Wednesday as concerns
shifted to a shaky global economy and its impact on demand,
after the uncertainty about the U.S. presidential race faded
with Barack Obama's re-election.
"What we're seeing is some short-covering, but I don't
expect oil to rebound completely," said Ken Hasegawa, a
commodity sales manager at Newedge Japan in Tokyo.
"With all these uncertainties in Europe and the U.S., I
don't think oil demand will increase."
Front-month Brent futures traded 52 cents higher at
$107.34 per barrel at 0335 GMT. Brent's near 4-percent slump on
Wednesday was its steepest since December 2011.
U.S. crude rose 42 cents to $84.86 a barrel, after
losing nearly 5 percent in the previous session, also its
biggest slump since December 2011.
Investors were also monitoring the impact of a second winter
storm that hit the U.S. Northeast on the heels of devastation by
Hurricane Sandy as well as data showing higher U.S. inventories
of crude and products last week.
"FISCAL CLIFF" AND EUROPE
After weeks of range bound trading ahead of the U.S.
presidential elections, the market began to focus on economic
uncertainties post election.
Topping the list is negotiations on "fiscal cliff," a $600
billion package of spending cuts and tax increases that may trim
the deficit but push the fragile U.S. economy into deep
Weakness in the U.S. economy at a time when China is
struggling to push up its growth rate and Europe is grappling
with its debt crisis may derail the global economic recovery
Europe's crisis swung back into focus after European Central
Bank Chairman Mario Draghi said the euro zone economy will
remain weak in the near term, even as he hinted at unlimited
intervention in the region's sovereign markets.
Investors will also be monitoring the one-in-a-decade
leadership change in China, the world's No. 2 energy consumer,
as President Hu Jintao hands over charge to his successor Xi
Jinping, although there are no real concerns about changes in
But supply concerns with increasing violence in the Middle
East are expected to keep prices supported.
Syrian rebels fired mortars at President Bashar al-Assad's
palace in Damascus on Wednesday but missed, in an attack
underlining the growing boldness of forces fighting to end his
family's 42 years in power.
In Yemen, a gunman shot dead a Yemeni security officer near
the interior ministry in the centre of the capital Sanaa on
Wednesday, a police source said, blaming al Qaeda.
The U.S. and Yemen's neighbour Saudi Arabia are keen to stop
al Qaeda and other Islamist militants strengthening their hold
on a country which is close to major shipping lanes.
Reining in gains, data showed that U.S. crude and product
stocks rose last week in spite of inventory drops on the East
Coast, where Hurricane Sandy interrupted imports, refining
activity and fuel supply chains.
Domestic crude stocks rose 1.77 million barrels in the week
to Nov. 2, government figures showed, in line with analyst
forecasts in a Reuters poll for a rise of 1.8 million barrels.
(Editing by Himani Sarkar)