Brent slips below $108 as U.S. govt on brink of shutdown
* Partisan deadlock in U.S. Congress threaten to shut govt
* Weak China manufacturing data adds to economic recovery worries
* Iran to meet P5+1 in mid-Oct for nuclear talks
* Coming up: Euro zone Markit manufacturing PMI; 0758 GMT
SINGAPORE, Oct 1 (Reuters) - Brent crude edged below $108 a barrel on Tuesday to trade near a 7-week low on the prospect of a U.S. government shutdown that could crimp oil demand, while investors also eyed easing tensions in U.S.-Iran nuclear talks.
A partisan deadlock in the U.S. Congress over Republican efforts to halt President Barack Obama's healthcare reforms threatened to shut the government down if the politicians cannot agree on a spending bill by midnight on Monday.
"The shutdown of the government would result in the decrease in demand for oil in the world's top oil consumer, pressuring prices, as hundreds of thousands of government employees would be forced to stay home without any pay," Teoh Say Hwa, head of investment at Phillips Futures wrote in a note.
Brent crude for November fell 38 cents to $107.99 a barrel by 0255 GMT. U.S. crude was at $101.95, down 38 cents.
Oil prices have come under downward pressure in the past month as supply has improved, with Libya ramping up output while tensions over Syria and Iran eased.
"A lot of bull factors have been removed from the market," said Ken Hasegawa, a commodity sales manager at Newedge Japan.
"I can't find any bullish factors for oil."
Technical charts showed that U.S. crude futures may fall to $100 after breaking a support level of $102, Hasegawa said, adding that the next support level for Brent is at $105.85.
In China, weaker-than-expected growth in the manufacturing sector in September added to concerns that the nascent recovery at the world's second largest economy may be foundering.
Signs of a thawing in relations between the United States and Iran also weighed on oil prices.
Obama and new Iranian President Hassan Rouhani spoke by telephone last week in the highest-level contact between the countries in more than three decades, fuelling hopes for a resolution of Iran's decade-old nuclear standoff with the West.
The world's six major powers will meet Iranian officials in Geneva on Oct. 15-16 to discuss Iran's nuclear programme.
Investors are also looking ahead to U.S. oil inventories data on Wednesday. The U.S. Energy Information Administration (EIA) said it has enough resources to operate approximately through Oct. 11 in the event of a government shutdown.
U.S. commercial crude oil inventories were forecast to have risen last week, while gasoline stockpiles were seen lower, a preliminary Reuters poll of five analysts showed.
(Reporting by Florence Tan; Editing by Richard Pullin)