* Weekly API data expected to show fall in U.S. crude stocks
* China PMI up; U.S. manufacturing index seen rising
* Reuters survey shows fall in OPEC compliance to 68 percent
(Updates prices, detail, comment)
By Christopher Johnson and Catherine Bosley
LONDON, Sept 1 (Reuters) - Oil fell below $70 a barrel on
Tuesday, mirroring weaker equity markets, and dragged by data
showing Britain's manufacturing sector dipped unexpectedly in
August.
Traders were awaiting the release of a gauge of U.S.
manufacturing activity in August and weekly crude inventory data
later on Tuesday, which were expected to show a rebound in the
U.S. economy and oil consumption.
Global stocks <.MIWD00000PUS> eased after economic data in
China failed to erase concern among equities investors over the
durability of this year's share market rally. []
By 1124 GMT, U.S. crude for October delivery <CLc1> was down
15 cents at $69.81 a barrel. London Brent crude was up 12 cents
to $69.77.
"I don't see a strong recovery in the oil price," said Eugen
Weinberg, analyst at Commerzbank.
"The risk factors ... freight rates, a weak stock market,
possibly also a stronger dollar and weak equity markets in
Europe today indicate prices are likely to fall."
China's official purchasing managers' index (PMI) for August
reached a 16-month high, according to surveys on Tuesday.
[]
The data helped crude rise to an intra-day high of $70.64 as
the market recovered from a 4 percent fall on Monday in response
to worries about Chinese curbs to lending.
U.S. DATA
Oil traders will look for fresh direction to the next sets
of data on the world's biggest energy market, the United States.
The Institute for Supply Management's manufacturing gauge
will be released at 1400 GMT and is expected to be in positive
territory for the first time since the recession began, a
Reuters poll of economists showed.
Then at 2030 GMT, weekly oil inventory data from the
American Petroleum Institute (API) is expected to show a 400,000
barrel fall in U.S. crude stocks following an increase in
refinery utilisation, a preliminary Reuters poll of analysts
showed. []
The industry data will be followed on Wednesday by figures
from the U.S. government's Energy Information Administration
(EIA).
Adding to already high inventories, OPEC has reduced its
compliance with agreed production curbs, a Reuters survey on
Tuesday found.
OPEC supply in August rose for a fourth consecutive month as
Saudi Arabia, Nigeria and Venezuela increased their production,
taking overall output discipline to 68 percent from a revised 70
percent in July. []
The Organization of the Petroleum Exporting Countries meets
on Sept. 9 in Vienna to reconsider its output policy.
(Additional reporting by Jennifer Tan in Singapore; editing
by Keiron Henderson)
