UPDATE 3-Brent falls to around $106 on Iran hopes, strong dollar

Alexander Winning
Tuesday, 12 Nov 2013 | 4:55 AM ET

* Conflicting signals from Iran talks pressure oil

* U.S. crude stocks seen rising -Reuters poll

* Stronger dollar weighs

(Updates throughout, changes dateline from previous SINGAPORE)

LONDON, Nov 12 (Reuters) - Brent crude futures fell to around $106 a barrel on Tuesday as investors watched for further signs of easing tension between the United States and major oil producer Iran, while traders booked profits after steep gains in the previous two sessions.

A strengthening dollar and an expected build-up in U.S. crude stockpiles also weighed on prices. A strong dollar makes commodities priced in the greenback more expensive for overseas investors.

Brent crude for December delivery was 46 cents lower at $105.94 a barrel at 0930 GMT. U.S. crude was down 66 cents at $94.48 a barrel.

"We're seeing a slight retracement after a strong rebound in the previous two sessions," said Olivier Jakob, an oil analyst at Petromatrix in Zug, Switzerland.

"There were confusing signals coming from the Iran talks at the end of last week and it's continuing to add volatility to oil markets," Jakob said.

Unsuccessful weekend talks over Iran's nuclear programme lifted Brent off last week's four-month low on Monday, but U.S. Secretary of State John Kerry said he hoped an agreement would be signed within months.

Oil investors are awaiting the next round of talks between Iran and Western powers on Nov. 20 for clearer signals as to whether the sanctions regime against Tehran will be relaxed.

Sanctions against Iran have helped support global oil prices by removing more than 1 million barrels per day of oil from world markets. Any rise in Iranian supply could push oil prices lower, analysts say.


Expectations of rising U.S. crude stockpiles also pressured oil, as a preliminary poll of Reuters analysts last week forecast a 1.6 million barrel rise in stocks when the U.S. Energy Information Administration publishes its data on Thursday.

Industry group the American Petroleum Institute will release its report on Wednesday.

Investors will also be monitoring the unveiling of China's economic blueprint for the next decade later on Tuesday.

While not likely to have a direct impact on oil prices, the announcement will show how committed China's new leadership is to reform of the world's second-largest oil consumer after formally taking power in March.

(Additional reporting by Jacob Gronholt-Pedersen in Singapore; editing by Jason Neely)