UPDATE 4-Oil slides below $41, fuel demand shrinks

                                
 * Investors await U.S. economic data later on Monday
                                
 * U.S. figures shows lower fuel demand in November
                                
 * New car sales drop further in Spain, France
                                
 * Labour action in Britain, U.S. offer some support
                                
 
 (Adds quote, updates prices)
                                
 By David Sheppard
                                
 LONDON, Feb 2 (Reuters) - Oil fell below $41 a barrel on
Monday as a deepening U.S. recession shrank demand in the
world's top fuel burner and evidence mounted of a global
downturn.
                                
 Growing concern over poor economic data and falling
corporate profits took a toll on equity markets, which hit a
one-week low and sent the euro to a two-month trough against the
dollar. [MKTS/GLOB]
                                
 The price of crude has plunged by more than $100 from its
peak near $150 last July as energy use slows worldwide.
                                
 U.S. light crude for March delivery <CLc1> fell $1.26 to
$40.42 a barrel by 1241 GMT, after gaining as much as 63 cents
in early trade.
                                
 London Brent crude <LCOc1> shed $1.11 to $44.77 a barrel.
                                
 "Demand concerns are still weighing on prices, with the
macroeconomic outlook still pretty bleak," said Andrey
Kryuchenkov, Vice President of Commodities at VTB Capital in
London.
                                
 "But we'd probably need to see a big crude stock-build again
in the U.S. this week to move us below $40."
                                
 A report from the U.S. Energy Information Administration on
Friday showed U.S. oil demand in November was 305,000 barrels
per day (bpd) less than previously estimated and was down 1.577
million bpd from a year earlier.
                                
 Investors were awaiting Monday's U.S. economic indicators
for a fresh assessment of the world's largest economy.
                                
 Data due to be released include personal income and
consumption, construction spending for December and the
Institute for Supply Management's January index of manufacturing
activity.
                                
 Grim news was already out in Europe, where Euro zone
manufacturing shrank and factory prices tumbled at their fastest
rate in at least six years. [ID:nSP388913]
                                
 Sales of new cars dropped further in Spain and France.
[ID:nL286895]
                                
 Bleak economic data also emerged from South Korea, which
showed January exports contracting at a record pace.
[ID:nSEO254383]
                                
 Some support for the oil price on Monday was offered by
refinery strikes on both sides of the Atlantic.
                                
 United Steelworkers negotiators and oil company
representatives returned to the bargaining table on Sunday, a
day after telling thousands of U.S. refinery and chemical plant
workers to stay on the job as they try to hammer out a new
national contract. [ID:nN01419270]
                                
 In Britain, several hundred workers at the Sellafield
nuclear plant walked out on Monday, joining wildcat strikes over
the use of foreign workers that has mostly affected oil and
power plants. [ID:nL2715973]
                                
 Signs from OPEC that it might remove more supply on top of
record output curbs and an abrupt end to a ceasefire in
Nigeria's oil-rich Niger delta also supported prices.
                                
 OPEC Secretary General Abdullah al-Badri told Reuters on
Friday the producer group was willing to cut output further at
its meeting in March, adding to agreed cuts of 4.2 million bpd
since September to prop up prices [ID:nLU102745].
 (Additional reporting by Peg Mackey in London and Fayen Wong in
Perth, editing by Anthony Barker)