Brent steady above $117 on dim EU growth prospects

LONDON: Brent crude held near $117 per barrel on Tuesday after falling in the last three sessions as traders eyed lacklustre European growth and waited for US data to provide demand clues for the world's largest oil user.

Forecasts for a slowdown in France's GDP growth in 2013 and elections in Italy have added to uncertainty on the euro zone outlook, curbing investors' appetite for riskier assets like oil.

Brent crude for April delivery slipped 2 cents to $117.36 a barrel by 1043 GMT. US crude for March fell 41 cents from Friday's close to $95.45.

There was no settlement for US crude futures on Monday due to a holiday in the United States.

"The caution might be a bit sharper in oil, as we had quite a bit of a run-up and the market is vulnerable to bad news at the moment," said Ric Spooner, chief markets analyst at CMC Markets in Sydney, pointing to rising wariness among investors in risk markets.

Brent speculators reduced their net long positions from a record high in the week to February 12 in a sign of investor wariness.

Brent is nearly $2 off a 9-month high of $119.17 hit earlier in February on a price run-up spurred by economic recoveries in the world's top two oil consumers, the United States and China, and higher demand forecasts from the US Energy Information Administration and OPEC.

Andrey Kryuchenkov of VTB Capital identified a large risk premium of around $10 a barrel in the Brent price linked to Middle Eastern tensions over Iran's disputed nuclear programme.

Investors are expected to eye the next round of nuclear talks between major powers and Iran next week. Sanctions on the OPEC producer have reduced its oil exports, which could have fallen below 1 million barrels per day (bpd) in January, according to estimates from the International Energy Agency (IEA).

"The political risk premium is overblown so Brent won't get any higher unless something happens in the Middle East. People will probably take profits this week," he said.