* Weak U.S. economic data, rise in Libyan supply weigh
* Major powers, Iran likely to start final nuclear talks in
* U.S. crude, oil product inventories to rise -poll
* Coming up: euro zone industrial production at 1000 GMT
By Florence Tan
SINGAPORE, Jan 14 Brent crude edged down towards
$106 a barrel on Tuesday as Libyan supply picked up and as the
restart of Iranian oil shipments appeared to get closer.
Recent weak economic data from the United States has also
dampened the outlook for fuel demand in the world's largest oil
February Brent crude had edged down 10 cents to
$106.65 a barrel by 0249 GMT after closing down 0.47 percent in
the previous session. U.S. crude for February delivery
was at $91.85, up 5 cents after settling at a two-session low on
"Oil markets seem to have weakened in the last few days
because of lower U.S. economic indices like employment data and
a rise in oil exports from Libya," said Ken Hasegawa, a
commodity sales manager at Newedge Japan.
Major powers and Iran have also moved a step closer to
resolving a long standoff over Tehran's nuclear ambitions after
endorsing a deal that will come into force on Jan. 20.
The parties are likely to start talks on a final settlement
in February, a diplomatic source said on Monday.
A resolution to the issue could see western powers lifting
sanctions on the OPEC producer's oil exports, increasing global
Libya's production has also risen to 600,000-650,000 barrels
per day (bpd), with output at the El Sharara field back up to
300,000 bpd, its oil minister said. Wrecked by months of
domestic protests, the OPEC producer's output is still below the
1.2 million bpd it was producing in July.
Britain's biggest oilfield, Buzzard, where an outage last
week temporarily boosted Brent, is expected to return to normal
output in coming days, its operator Nexen confirmed on Monday.
"There are no positive factors to buy oil except if you are
short-covering or bargain-hunting," Hasegawa said, adding that
Brent and West Texas Intermediate (WTI) were supported on
technical charts at $106 and $91.20-$91.30 respectively.
Prices could come under further pressure if oil product
stockpiles rose in the United States last week, reinforcing
concerns of lower demand after it posted the weakest monthly job
growth in three years in December, Hasegawa said.
Analysts in a preliminary Reuters poll said U.S. crude
inventories likely rose last week for the first time in seven
weeks, up by an average of 500,000 barrels.
In the refined products sector, distillate stocks, which
include heating oil and diesel fuel, were forecast to have risen
1.6 million barrels on average, while gasoline stocks were seen
to have increased by 2.7 million barrels last week, the poll
(Reporting by Florence Tan; Editing by Joseph Radford)