UPDATE 2-Brent steady around $106; demand concerns, Fed meet in focus
* Investors eye June 18-19 Fed meeting, seek clarity on stimulus
* Brent prices near zone of resistance - analyst
* Impact of Iran presidential elections still unclear
(Adds analyst quote, updates prices)
SINGAPORE, June 17 (Reuters) - Brent crude futures steadied around $106 a barrel on Monday after hitting more than two-month highs in the previous session, as worries over bulging U.S. inventories and soft global demand forecasts offset supply concerns tied to Middle East tensions.
The oil market was also cautious ahead of a U.S. Federal Reserve policy committee two-day meeting starting on Tuesday. Investors are eyeing whether Chairman Ben Bernanke's media briefing will provide more clarity on how and when the central bank will scale down its massive stimulus programme.
"The retreat in the U.S. dollar leading into the Fed meeting has given oil traders some impetus to push through resistance levels," said Sydney-based Ric Spooner, chief market analyst at CMC Markets.
Brent crude edged up 1 cent to $105.94 a barrel by 0634 GMT, while U.S. oil dropped 8 cents to $97.77 a barrel.
The European oil benchmark ended last week at its highest since April 9 after hitting an intraday peak of $106.64 on geopolitical worries in the Middle East, despite a grim global oil demand outlook from the International Energy Agency (IEA), OPEC and the U.S. Energy Information Administration.
Brent faces a zone of technical resistance around $106.50-$106.70, Spooner of CMC said.
"As you can clearly see fundamentals are not supportive of the jump on Friday, the market will now need to see a catalyst like a supply disruption as a result of Middle East tensions, or a further weakening of the dollar for whatever reason," he said.
Reuters market analyst Wang Tao said U.S oil is slated to retreat to $97.04 a barrel, while Brent is to remain in a neutral range of $105.34-$106.68 a barrel.
Syria will be a key talking point between U.S. President Barack Obama and Russia's Vladimir Putin on Monday, as both seek to find common ground in bringing Bashar al-Assad to the negotiating table to end a two-year civil war.
Late last week, Washington angered the Kremlin by authorising U.S. military support for the Syrian rebels opposed to Assad. Russian President Vladimir Putin called Assad's foes flesh-eating cannibals.
Syria is not key to global oil supply, but investors are worried the civil war there could drag into other countries and plunge the whole region into conflict.
Investors are also watching to see if Iran's Hassan Rohani, who defeated hardline rivals in Iran's weekend presidential elections, will have any immediate impact in resolving a dispute with the United States over Tehran's nuclear ambitions that has led to Western sanctions squeezing its oil exports.
"Over the near term, Rohani's victory should take some risk premium out of oil markets," Citi said in a research note. "And over the medium term (12-18 months), the recent US commitment to arm the Syrian opposition works to moderate any Israeli unilateral action."
(Editing by Joseph Radford and Muralikumar Anantharaman)