* STOXX down 0.15 percent
* Banco Popular drops to new record low
* Gains in BP, Shell provide some support
* London-listed travel stocks suffer
* Shares in Qatar's top holdings mixed
* Frankfurt closed for holiday (Adds details, updates prices)
MILAN, June 5 (Reuters) - European shares slipped on Monday as an early boost from energy shares faded, and banks fell, led lower by Spain's Banco Popular on concerns that it could be wound down.
The pan-European STOXX 600 index was down 0.15 percent by 0958 GMT, with activity reduced by a public holiday in the region, while Britain's FTSE, which hit a fresh record high on Friday, was also down, by 0.3 percent.
An Islamist attack in London days before a national election on Thursday had no major impact on broader equity markets, while geopolitical tensions in the Middle East lifted energy stocks in early deals.
Crude oil prices rose 1 percent before paring gains after top exporter Saudi Arabia and other Arab states cut ties with Qatar, accusing it of supporting terrorism.
"The move is unlikely to have a material impact on the physical market but the prospect that rising tensions could result in disruptions ... makes the immediate price response a reasonable one," Exane said in a note to clients.
"Longer term, any rising tensions ... are potentially negative for the price; cuts are made easier by the fact that producers are willing to work together," it added.
Shares in BP and Royal Dutch Shell rose slightly, while Italy's Eni declined 0.3 percent and France's Total fell 0.2 percent.
Meanwhile shares in companies in which Qatar holds stakes were mixed. Miner Glencore fell 1.5 percent as basic resources stocks led sectoral fallers, while Shell rose and utility Iberdrola, Barclays bank and builder Vinci were down just slightly.
The German and some other European stock markets were closed for a public holiday, reducing overall activity.
Banks were the biggest drag to the STOXX index with Banco Popular falling as much as 18 percent to fresh record lows on worries that it could be wound down if it does not find a buyer.
Investors dismissed attempts by the company's chairman, Emilio Saracho, to soothe nerves. In a letter sent on Friday, Saracho told his executives that the bank was solvent and urged them to remain calm and confident.
A trader at an Italian bank said the recent price slide made any recapitalisation of Banco Popular hard to achieve, while there could also be risks of contagion to other Spanish banks.
Banco Santander fell 1 percent.
Some travel stocks suffered after the attack in London on Saturday. Budget airline Easyjet fell 1.9 percent, and Merlin, which runs attractions including London's Madame Tussaud's waxworks museum, fell 1.6 percent. (Reporting by Danilo Masoni)