UPDATE 6-Oil falls on weak economic data from Europe, Asia
* U.S. manufacturing sector expands in September
* China's factory activity shrinks for 2nd month in Sept
* Euro zone manufacturing points to new recession
(Updates prices, adds details)
By Adam Kerlin
NEW YORK, Oct 1 (Reuters) - Brent crude slipped on Monday in light, choppy trading as oil markets balanced better-than-expected U.S. manufacturing data against signs of economic weakness in Asia and evidence of a new recession in the debt-saddled euro zone.
The international benchmark came under early pressure from data showing factory activity in No. 2 oil consumer China contracted, while euro zone manufacturing suffered the worst quarter for three years in the three months to September.
Prices briefly pushed higher in early U.S. activity after data showed U.S. manufacturing expanded in September, shaking off three months of weakness as new orders and employment picked up. The data helped keep U.S. crude in positive territory, even as Brent shook off gains to again trade lower.
"This is a market that has plenty of excuses for moving higher," energy analyst Tim Evans of Citi Futures Perspective said, pointing to the U.S. Federal Reserve's latest quantitative easing and geopolitical tensions in the Middle East.
"But without stronger physical demand for petroleum, higher price levels will not be sustainable."
Oil markets have been weighing unrest in the Middle East and the potential for supply disruptions as well as maintenance-related delays in North Sea crude shipments against weak fuel demand and economic data in recent weeks.
Front-month Brent crude traded down 32 cents at $112.07 a barrel by 2:02 p.m. EDT (1802 GMT), off highs of $113.37 a barrel struck earlier in the session.
U.S. crude rose 27 cents to trade at $92.46 a barrel, having hit $93.33 earlier.
Trading volumes were light, with Brent volumes nearly 38 percent below the 30-day moving average and U.S. trade 46 percent off that average by 2 p.m.
Brent gained 14.9 percent in the third quarter, following a drop of 20 percent in the second quarter, while U.S. crude rose 8.5 percent in the quarter after slumping 17.5 percent in April-June.
Brent's premium to U.S. crude fell to $19.61 a barrel, after nearing $21.00 during intraday trade on Friday, its highest level since mid-August.
U.S. November RBOB gasoline futures were down 0.09 percent near $2.92 a gallon on Monday, following a rally last week ahead of the expiry of the October contract that sent the front-month contract to the highest level since April.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Brent 24-hr chart analysis: US oil 24-hr chart analysis: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> ECONOMIC DATA
U.S. crude and the stock markets found support from the Institute for Supply Management (ISM), which reported its index of U.S. national factory activity rose to 51.5 from 49.6 in August, topping expectations for 49.7. It was the first time since May that the index has been above the 50 threshold that indicates expansion in the sector.
Stocks later pared gains after Federal Reserve Chairman Ben Bernanke delivered a broad defence of the central bank's controversial bond-buying stimulus plan.
An official survey of factory managers in China remained in contraction territory for a second successive month in September despite improving slightly from a nine-month low in August, as the world's second-biggest economy struggles against cooling exports, factory output and fixed asset investment.
The ECB will hold a policymakers' meeting on Thursday and traders will be closely watching ECB chief Mario Draghi's comments.
The EU warned on Monday of an "economic and social disaster" if joblessness among young Europeans continued to rise, calling for a joint effort to combat record high unemployment in the countries which share the euro.
(Additional reporting by Dmitry Zhdannikov in London; Editing by Dale Hudson and Alden Bentley)
Keywords: MARKETS OIL/