* Dollar's climb pressures, but hurricane worry supports
* Investors eye tension between West and Russia
* Focus on U.S. oil data
(Recasts, updates prices)
TOKYO, Aug 26 (Reuters) - Oil hovered around $115 a barrel
on Tuesday as the dollar strengthened, but losses were limited
as tropical storm Gustav in the Caribbean turned into a
hurricane, stoking concerns over output disruptions in the Gulf
of Mexico.
Also supportive were tensions between the West and Russia
over Georgia and expectations that oil exporter group OPEC,
which meets on Sept. 9, could trim production should prices
fall further.
Crude for October delivery <CLc1> fell 6 cents to $115.05 a
barrel by 0658 GMT, while London Brent crude <LCOc1> was down 1
cent at $114.02 a barrel.
Gustav swirled through the central Caribbean and bore down
on Haiti on Tuesday, the U.S. National Hurricane Center said.
[]
The official forecast called for Gustav to move to the
northwest across Haiti and then south of central Cuba, possibly
towards the Gulf of Mexico.
"I think overall the trend of the market is bearish right
now, but the hurricane premium as well as the Russia-NATO
premium is what's keeping the market from dropping further,"
said Jonathan Kornafel, Asia director at U.S.-based options
trader Hudson Capital Energy.
Russia's parliament urged the Kremlin on Monday to
recognise two rebel regions of Georgia as independent states,
raising alarm in the West. []
Reflecting the fragility of the ceasefire declared after
Russian troops marched into the pro-western state, Georgian and
separatist forces were in a tense standoff over a disputed
village on the fringes of breakaway South Ossetia.
Oil will also watch the dollar, which climbed towards a
six-month high against the euro and jumped against the
Australian and New Zealand dollars on renewed jitters over the
financial sector. []
Investors will want to see if the German Ifo survey of
business sentiment shows whether the euro zone economy is
weakening further, a factor that has been behind dollar gains
recently.
OPEC OUTPUT
Iran's oil minister said on Monday he expected OPEC to work
on preventing the falling trend in crude prices and also to
study oversupply in the market when it meets on Sept. 9 in
Vienna. []
But an OPEC source said the cartel is likely to keep oil
output policy unchanged. []
The market will turn its focus on Wednesday to U.S. crude
oil inventories, which are likely to have risen 1.4 million
barrels last week, a Reuters preliminary poll showed. []
In the previous week, crude stocks shot up by 9.4 million
barrels as crude imports rose after delivery delays caused by
Tropical Storm Edouard.
The poll of eight analysts showed an average forecast for a
400,000-barrel gain in distillates.
Analysts expect U.S. gasoline stocks to show a drop of 2.8
million barrels, a fifth straight weekly decline, as refiners
drained storage of summer-grade supply ahead of the Labor Day
holiday weekend, which marks the end of the summer driving
season.
(Reporting by Osamu Tsukimori and James Topham; Editing by Ben
Tan)
