SINGAPORE: Brent futures slipped for a sixth day on Tuesday on worries over oil demand growth due to an uncertain global economic outlook, but stayed above $109 a barrel with simmering tensions in the Middle East helping stem the slide.
Global growth fears revived after the world's largest maker of tractors and excavators Caterpillar Inc. warned the global economy was slowing faster than expected. That overshadowed worries about supply disruption in the oil market from the Middle East after violence intensified in Lebanon.
Brent crude had slipped 19 cents to $109.25 a barrel by 0612 GMT, just off the three-week intraday low of $109.12 touched in the previous session.
"People can't seem to get their heads around the global growth outlook," said Jonathan Barratt, chief executive of Barratt's Bulletin, a Sydney-based commodity research firm. "There is no clear indication on how the global economic growth issue will be tackled by policymakers."
Barratt expects oil to continue trading in a tight range until election results in the United States, the world's top oil consumer, and there is further clarity on the government's policies and budget.
Earlier in the day, oil futures rose to as much as $109.80 a barrel as investors judged the previous session's fall as an opportunity to buy. Asian shares, the euro and base metals had all recovered.
"(Markets saw) a moderate risk-on mood in the Asia Pacific," said Ric Spooner, chief market analyst at CMC Markets in Sydney.
"(We saw) a bit of anticipatory confidence about China basing out and on the green shoots in the United States. Equities were up and looked like that was flowing through to the oil market."
At least seven people were killed and dozens wounded in gunbattles in the Lebanese capital Beirut and coastal Tripoli on Monday. The clashes have heightened fears that Syria's civil war with its sectarian dimensions is now spreading into Lebanon, and may spread further across the region.
Supply worries worsened after police in Kuwait used teargas, stun grenades and baton charges to disperse tens of thousands of demonstrators protesting changes to the electoral law which the opposition has called a constitutional coup by the government.
Oil prices were also supported after Germany's finance ministry wrote in its monthly report that the economy likely grew in the third quarter despite a weak global backdrop thanks to a strong performance by the country's industry and robust exports to areas outside the euro zone.
Many economists had forecast the economy would contract in the third quarter, particularly as Germany's closely-watched Ifo business sentiment index worsened for five months in succession.
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