UPDATE 6-Oil prices rise as Libyan output squeezed

* Libya's El Feel oilfield shut again by protesters

* 4 dead in clashes in Libya's Benghazi

* Russia offers Ukraine natgas discount

* Washington warns Russia of further sanctions over Ukraine

* U.S. consumer sentiment falls in May

(New throughout, adds U.S. economic data, updates prices, adds analyst comments, changes dateline, byline, previous LONDON)

NEW YORK, May 16 (Reuters) - Global oil prices rose on Friday as investors worried about Libya after a recovery in the OPEC country's oil supply proved short-lived and government forces clashed with Islamist militias.

Libya's El Feel oilfield was shut again by protests and the El Sharara field remained closed, bringing national oil output down to about 200,000 barrels per day (bpd) - far from the 1.4 million bpd pumped last year.

The government had pledged to bring western oilfields and pipelines back online after it reached a deal with protesters, and output had clawed back to around 300,000 bpd.

In the east of the country, Libyan irregular forces clashed with Islamist militias in Benghazi, killing at least four people.

"We have to take Libyan reports that these oilfields are back up with a grain of salt because it's still very uncertain there," said Joseph Posillico, senior vice president of energy derivatives at Jefferies Bache in New York. "Some of that is supporting Brent."

Brent crude rose 85 cents to $109.94 a barrel by 11:45 a.m. EDT (1545 GMT). U.S. crude climbed 55 cents to $102.05.

A dispute between Russia and Ukraine over payment for natural gas eased as Russia offered Ukraine a discount if it paid $2.2 billion of the $3.5 billion debt Moscow says Kiev owes for natural gas supplies.

Meanwhile, U.S. Secretary of State John Kerry warned Russia it faced broader economic and industrial sanctions from the United States and Europe if it meddles in Ukraine's presidential elections on May 25.

U.S. economic data offered contrasting pictures for growth in the world's largest oil consumer.

A monthly gauge of U.S. consumer sentiment fell in May as a gloomy view on income growth clouded an otherwise positive economic outlook, a preliminary reading of the Thomson Reuters/University of Michigan's survey showed.

Earlier, data showed U.S. housing starts jumped in April and building permits hit their highest level in nearly six years, offering hope that the troubled housing market could be stabilizing.

Investors also kept an eye on talks due to end Friday over Tehran's nuclear program.

A senior U.S. official said Iran and six world powers were making little progress in arduous talks on ending their dispute over Tehran's nuclear program, fanning doubt about the prospects for a breakthrough by a self-imposed July deadline.

Iran's oil exports averaged 1.11 million barrels per day (bpd) in April, the second month in a row exports have fallen, the Paris-based International Energy Agency said. That is close to the 1 million bpd allowed under November's pact.

(Additional reporting by Peg Mackey in New York and Keith Wallis in Singapore; Editing by William Hardy, David Evans and David Gregorio)