* Obama says US to reduce oil imports by 1/3 in ten years
* US crude oil stocks forecast higher: EIA data at 1530 GM
* Gaddafi forces move east in Libya
* U.S. ADP employment data (1215 GMT)
(Updates with Obama plan, prices)
By Ikuko Kurahone
LONDON, March 30 (Reuters) - Oil fell on Wednesday, weighed
down by swelling crude inventories in the United States while
President Barack Obama is expected to set a long-term goal to
cut oil imports.
The drop in prices, however, was capped by civil unrest in
North Africa and the Middle East.
North Sea Brent crude futures <LCOc1> fell 25 cents to
$114.90 a barrel at 1150 GMT. U.S. crude <CLc1> fell 36 cents to
$104.43.
The trading volume on both contracts was relatively small,
with the end of the first quarter near.
Prices have risen from $93 at the end of December, touching
2-1/2-year highs just below $120 in February.
Christopher Bellew with Bache Commodities cited bulging
crude oil stocks in the United States and a dip in fuel demand
between the winter heating season and the summer gasoline season
as a factor capping any gains in oil prices.
"In the short term we are at the end of the Northern
Hemisphere winter, with a seasonal fall in demand," Bellew said.
"The dichotomy is between the world being well supplied with
oil in the short term and the uncertainties that loom in the
medium term."
In the medium term, prices are likely to be supported by
civil unrest in the oil-rich Arab world and an expected increase
in oil and gas demand following a global backlash against
nuclear power generation. Nuclear reactors in Fukushima, Japan,
continue to emit radioactivity after severe damage caused by an
earthquake and tsunami earlier in March.
In the long term, Obama will outline a strategy to cut oil
imports by a third over 10 years, focusing on energy security at
a time that high gasoline prices could stall U.S. economic
recovery.
The White House says this is a deliberate turn toward energy
security by Obama and will be followed by other events to
highlight his strategy. [] But the immediate market
reaction was limited.
"It sounds like a very ambitious target indeed," said
Carsten Fritsch, analyst at Commerzbank.
"It will be difficult to achieve. Perhaps there will be
large energy, fuel saving measures or they would need to allow
more oil drilling, but after the Gulf of Mexico (spill) it could
be difficult."
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic - US consumer confidence: http://r.reuters.com/nan78r
More on Middle East unrest: [] []
Libya Graphics http://link.reuters.com/neg68r
Interactive graphic http://link.reuters.com/puk87r
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
U.S. INVENTORIES JUMP
U.S. government oil data is expected to show a 1.8 million
barrel increase in the week to March 25 when it is released at
1430 GMT, a Reuters poll of analysts showed. []
Late on Tuesday, separate data from industry group the
American Petroleum Institute showed crude stocks rose by a sharp
5.7 million barrels last week. []
In Libya, rebels pulled out of the oil town of Ras Lanuf on
Wednesday under heavy bombardment from Muammar Gaddafi's forces,
showing their weakness without Western air strikes to tip the
scales in their favour. []
A conference of 40 governments and international bodies on
Tuesday agreed to press on with a NATO-led aerial bombardment of
Libyan forces until Gaddafi complies with a U.N. resolution to
end violence against civilians. []
In Syria, President Bashar al-Assad will on Wednesday give
his first public speech since pro-democracy protests erupted in
the south of the country. []
Analysts said U.S. ADP employment data at 1215 GMT Wednesday
was also on oil traders' watch list following Tuesday's gloomy
reading of U.S. consumer confidence in March due partly to high
fuel costs. []
(Additional reporting by Alejandro Barbajosa in Singapore;
editing by James Jukwey and Jane Baird)
