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UPDATE 3-Brent oil eases below $109 as Ukraine fears rattle markets

* U.S. crude stocks rise overall; down 1.1 mln barrels in Cushing

* U.S. gasoline stocks down nearly three times more than forecast

* Dollar holds near two-week highs, weighing on commodities

* Brent oil signals mixed - technicals

(Updates throughout; changes dateline from SINGAPORE)

LONDON, Feb 27 (Reuters) - Brent oil futures briefly slipped below $109 on Thursday, pressured by warmer weather in the United States and worries about escalating turmoil in Ukraine, though supply-disruption concerns kept losses in check.

Armed men seized the regional government headquarters and parliament on Ukraine's Crimea peninsula and raised the Russian flag in a challenge to the country's new rulers.

Tensions kept the dollar at two-week highs, weighing on dollar-denominated commodities such as oil.

Brent crude was down 45 cents at $109.07 a barrel by 0929 GMT, recovering slightly from an intraday low of $108.85. It settled almost unchanged overnight.

U.S. oil fell 15 cents to $102.44 a barrel, after ending 76 cents higher.

"When you get markets in their current state of flux you've got a general risk-off sort of bias to proceedings, so you've got a slight negative bias towards Brent," said Michael Hewson, senior analyst at CMC Markets.

"There's an awful lot of concern about what effect Ukraine might have on the European growth story."

U.S. crude outperformed Brent, supported as the U.S. Department of Energy said on Wednesday that stocks at the oil distribution hub of Cushing, Oklahoma had fallen for a fourth straight week.

This helped narrow U.S. crude's discount to Brent to less than $7 a barrel for the first time since early October.

"It looks like we are going to see a continuation of the tightening of the spread between U.S. oil and Brent still, even if we are already down to $7," said Bjarne Schieldrop, chief commodities analyst at SEB.

"The stocks in Cushing are decreasing and will likely continue to do so."

U.S. gasoline inventories fell much more than expected last week as mild weather coaxed more drivers back on the roads, data from the Energy Information Administration showed.

Concerns over the consumption outlook for China, the world's second-biggest oil consumer, also weighed on oil prices, as a Reuters poll showed factory activity probably expanded only slightly in February.

Oil traders are also watching the prolonged crisis in Libya, where oil output has slumped as the government struggles to control militias and improve law and order.

Libya's oil output has fallen to 230,000 barrels per day (bpd) from 1.4 million bpd last year when various groups began disrupting facilities to back political and financial demands.

(Additional reporting by Manash Goswami in Singapore; Editing by Dale Hudson)