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UPDATE 6-Brent falls as payrolls fail to dispel economy gloom

Simon Falush
Friday, 2 Nov 2012 | 3:18 PM ET

* U.S. payrolls data beats forecasts

* European manufacturing down for 15th month

* North Sea supply expected to return, Angolan force majeure

* U.S. crude inventories post surprise drop -EIA

(Recasts with latest price movements, adds quote)

LONDON, Nov 2 (Reuters) - Brent oil headed for its lowest close in three months on Friday, down for a fifth day, as firm U.S. jobs data helped push the dollar higher but failed to ease fears about the outlook for global demand.

U.S. employers stepped up hiring in October, and the jobless rate ticked higher as more workers restarted job hunts, a hopeful sign for a struggling economy. Employers added 171,000 people to their payrolls last month, significantly more than forecast.

This briefly pushed oil higher, but nagging doubts about the global economy after weak data elsewhere led some investors to take money off the table.

Brent crude for December was down 49 cents to $107.68 a barrel by 1456 GMT, heading for its lowest close since early August. U.S. crude for December was down $1.55 at $85.54.

``Some big players have changed sides from being very bullish to being bearish. They are taking profits off the table and closing positions,'' said Richard Langkemper, an analyst at Argos North Sea Group in Rotterdam.

As part of a downbeat broader economic picture, euro zone manufacturing shrank for a 15th month running in October as output and new orders fell, a survey showed.

Weak economic growth, high prices and improving vehicle fuel efficiency pushed down consumption of gasoline and diesel in most of western Europe over the summer, official statistics showed.

SUPPLY WATCH

Work began on restarting production at the North Sea Buzzard oilfield, which would add supplies to the most important of the North Sea crudes that underpin the Brent oil benchmark.

Supply from West Africa remained a concern, however, after U.S. oil major Chevron said its Angolan subsidiary Cabinda Gulf Oil Company had declared force majeure at the Kuito offshore oil terminal on Oct. 29 due to a fault with a mooring line.

Last month, Shell declared a force majeure on Bonny Light and Forcados grades of Nigerian oil due to fire, flooding and theft.

U.S. crude inventories fell unexpectedly last week as imports dropped sharply, the U.S. Energy Information Administration reported on Thursday.

Crude stocks dropped by 2.05 million barrels in the week to Oct. 26, the government figures showed. That compared with analysts' forecasts in a Reuters poll for a rise of 1.5 million barrels.

U.S. stocks of refined products were mixed as refinery utilization rose by 0.5 percentage point to 87.7 percent of capacity. However, they remained relatively low, keeping upward pressure on refining margins.

``The narrative of ample crude stocks and low refined product inventories remains intact despite the latest weekly changes to inventories,'' BNP analysts said in a note.

``We remain concerned that the existing low level of distillate stocks is set to continue into the winter.''

(Additional reporting by Alice Bagdhjian and Florence Tan in Singapore; Editing by David Cowell and Jane Baird)