Brent falls below $83 on weak fundamentals

By Seng Li Peng

SINGAPORE (Reuters) - Brent crude reversed gains to fall below $83 a barrel as a fragile economic outlook overturned short-term optimism over a lower-than-expected rise in U.S. crude stocks and solid U.S. job growth that had provided temporary relief.

Tensions in Libya, where gunmen seized the major El Sharara oilfield, became less of a focus. Air strikes by a U.S.-led coalition set up to fight Islamic State targeting the al Qaeda-linked Nusra Front in northwest Syria also did not lift sentiment.

"The upward price movement likely came from U.S. inventories not increasing as expected due to a drop in crude imports and also crude oil field production stagnated compared to last week," Phillip Futures said in a note, adding the gains could be short-lived as fundamentals have not changed.

December Brent and U.S. oil could be pushed back down, it said, with support levels at $82 and $75.84, respectively.

Brent fell 37 cents to $82.58 per barrel by 0751 GMT.

U.S. crude slipped 22 cents to $78.46 after gaining earlier following data that showed U.S. crude inventories had edged up 460,000 barrels in the week to Oct. 31 compared with analysts' expectations of an increase of 2.2 million barrels. [EIA/S]

The oil market had also earlier received further support from news of U.S. private employers having added 230,000 jobs in October, the highest total since June and exceeding economists' expectations, a report from a payrolls processor showed on Wednesday.

In Libya, at least 200,000 barrels per day (bpd) of oil production have been lost as the El Sharara oilfield has fallen to gunmen, sources said, while a fire was quickly extinguished at a pumping unit at Rosneft's Saratov oil refinery in Russia's Volga river region, the Emergencies Ministry said on Thursday.

Separately, Saudi Oil Minister Ali al-Naimi met with Venezuelan Foreign Minister Rafael Ramirez on Wednesday at a climate change conference on Venezuela's Margarita Island.

Neither party offered any comments on oil markets afterwards.

In the late 1990s, Naimi had helped broker a deal with Venezuela and Mexico to curb production and revive prices that had fallen to nearly $10 a barrel.

But veteran oil analysts see no sign of a new coalition in the making.

(Editing by Alan Raybould, Gopakumar Warrier and Biju Dwarakanath)