UPDATE 10-Oil eases on concerns over U.S.-China talks, weak demand signals

* Brent and WTI reverse early gains, settle down
* U.S. crude oil stocks rise 4.1 mln bbls-API
* Iraq and Ecuador unrest offers some price support
* Growing recession risk caps oil upside -analyst

(New throughout, adds API data and post-settlement trade)
By Devika Krishna Kumar
NEW YORK, Oct 8 (Reuters) - Oil prices slid on Tuesday as
Washington's blacklisting of more Chinese companies dampened
hopes for a trade deal between the two countries, although
unrest in Iraq and Ecuador lent some support to crude prices.
Early in the session, both Brent crude LCOc1 and West
Texas Intermediate (WTI) CLc1 rose more than 1%. But at
settlement, Brent was down 11 cents, or 0.2% at $58.24 a barrel
while WTI CLc1 fell 12 cents, or 0.2%, at $52.63.
Prices extended losses slightly in post-settlement trade
after American Petroleum Institute data showed U.S. crude
inventories rose by 4.1 million barrels in the week ended Oct.
4, far surpassing the 1.4 million barrels analysts had forecast.

Investors were cautious ahead of U.S.-China trade talks in
Washington on Thursday. U.S. President Donald Trump said a quick
trade deal was unlikely.
Washington is moving ahead with discussions over possible
restrictions on capital flows into China, with a focus on
investments by U.S. government pension funds, Bloomberg
reported. The U.S. Energy Information Administration (EIA) cut its
2020 world oil demand growth forecast by 100,000 barrels per day
(bpd) to 1.30 million. The oil market "will be forced to focus more succinctly on
global oil demand deterioration as it negotiates through the
monthly series of agency reports the rest of this week," Jim
Ritterbusch, president of Ritterbusch and Associates, said in a
note.
Oil prices were also pressured by an unexpected decline in
U.S. producer prices in September, which could give the Federal
Reserve room to cut interest rates again this month. U.S. stocks tumbled and the pan-European STOXX 600 index
.STOXX fell 1%. International Monetary Fund (IMF) Managing Director
Kristalina Georgieva warned that global economic deceleration
could turn into "a more massive slowdown" without action to
resolve trade conflicts and support growth. "The market's focus remains on trade tensions and oil demand
concerns, ignoring the elevated geopolitical tensions in the
Middle East and lower OPEC production in September," said UBS
oil analyst Giovanni Staunovo. "Growing recession risks have
capped the upside of oil prices."
Official weekly data from the U.S. EIA is due Wednesday at
10:30 a.m. ET. Analysts forecast crude inventories in the United
States would show a fourth week of growth while gasoline stocks
fell, a Reuters poll showed on Monday. The EIA said U.S. crude production is expected to rise by
1.27 million bpd in 2019 to a record 12.26 million bpd, slightly
above its previous forecast for a rise of 1.25 million.
Oil prices drew some support from protests in OPEC members
Iraq and Ecuador which threatened to disrupt their oil output.
In Iraq, protests resumed overnight in Baghdad's Sadr City
district.
"Unrest in Iraq gained a high profile at the start of
October as a result of large protests in Baghdad," RBC analyst
Al Stanton said.
He said potential attacks by Turkey on Kurdish forces in
northeast Syria could take place close to the Iraqi border,
leading to "a refugee crisis that puts pressures on Kurdistan's
economy" and its oil production.
Turkey said it had completed preparations for a military
operation in northeast Syria after the United States began
pulling back troops.
Ecuador's energy ministry said protests against austerity
could reduce its oil output by 59,450 bpd.

Saudi Arabia reiterated that it was ready to meet global oil
needs. Installations belonging to Saudi Aramco were attacked on
Sept. 14, hitting output and triggering a spike in oil prices.


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