* U.S. consumer spending falls in December.
* U.S. data show lower fuel demand in November
* No energy supply disrupted by British labour action
* New car sales drop further in Spain, France
(Updates prices, U.S. refinery talks)
By David Sheppard
LONDON, Feb 2 (Reuters) - Oil fell 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 also took a toll on
world equity markets and sent the euro to a two-month trough
against the dollar. U.S. consumers cut spending for a sixth
straight month in December and their incomes shrank.
U.S. light crude for March delivery <CLc1> fell 58 cents to
$41.10 a barrel by 1645 GMT, after gaining as much as 63 cents
in early trade. London Brent crude <LCOc1> shed $1.08 cents to
$44.80 a barrel.
"The economic data and consumer spending being down just
keep the demand problem in focus," said Dominick Chirichella of
Energy Management Institute.
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.
Slowing consumption has swollen fuel stocks and helped
knock more than $100 a barrel off the price of crude since its
July peak near $150.
Some analysts see oil holding above $40 in the near term.
"We'd probably need to see a big crude stock-build again in
the U.S. this week to move us below $40," said Andrey
Kryuchenkov, Vice President of Commodities at VTB Capital in
London.
Grim economic news also dominated Asia and Europe, where
Euro zone manufacturing shrank and factory prices tumbled at
their fastest rate in at least six years. []
Sales of new cars dropped further in Spain and France and
in South Korea, January exports contracted at a record pace.
Price support offered by refinery strike action on both
sides of the Atlantic also began to fall away as energy
supplies were not disrupted.
"The likelihood of a (U.S.) refinery strike is a lot less
than on Friday," said Energy Management Institute's
Chirichella.
Talks between United Steelworkers negotiators and oil
company representatives were "making good progress", the union
said, after resuming contract talks on Sunday and averting a
strike that would have slashed domestic fuel production.
[]
In Britain, energy supply was not impacted by workers at
nuclear, oil and gas plants who were protesting against the use
of foreign workers. []
Signs from OPEC that it might remove more supply on top of
record output curbs and an abrupt end to a cease-fire 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
barrels per day since September to prop up prices.
[]
(Additional reporting by Richard Valdmanis in New York, Peg
Mackey in London, Robert Gibbons in New York and Fayen Wong in
Perth; Editing by Marguerita Choy)
