* U.S. Senate expected to approve debt deal on Tuesday
* Focus moves back to weak economic indicators worldwide
* Coming Up: U.S. API weekly oil inventories; 2030 GMT (Adds quotes, updates prices)
By Zaida Espana
LONDON, Aug 2 (Reuters) - Oil fell on Tuesday on continued worries about the growth prospects of the United States, the world's largest crude consumer, after weak global manufacturing data that overshadowed a deal to avert a U.S. debt default.
Brent LCOc1 fell by 55 cents to $116.26 a barrel by 0920 GMT, having slipped as low as $115.53 a barrel earlier in the session.
U.S. crude CLc1 was 77 cents lower at $94.12 after trading as low as $93.42 on Monday, its lowest since late June, on news that the world's manufacturing expanded at its weakest pace in two years last month.
In Washington, the focus now turns to the Senate, where a $2.1 trillion deficit-cutting plan is expected to be approved in a vote on Tuesday, the deadline to lift the nation's debt limit.
But analysts said that market sentiment is likely to remain negative after the last disappointing manufacturing figures globally and weak U.S. gross domestic product (GDP) data.
"Positive Spin Economics do not work anymore as the economic realities have turned too negative to ignore...the problem is the manufacturing indices across the globe are disappointing", Olivier Jakob from Petromatrix said in a note. "Buying crude at $120 knowing that it is a level that destroys demand takes even greater faith than before when the PMIs (purchasing managers' indexes) and GDPs are under attack."
Commerzbank's Carsten Fritsch said the focus had moved beyond the U.S. debt negotiating debacle and onto the weak international data indicators.
"Debt concerns about the U.S. default are gone but now we have growth concerns coming back after the very disappointing GDP report on Friday and yesterday's ISM numbers, which were pretty dismal," Fritsch said.
"This is weighing on general sentiment and on crude in particular since the U.S. is the largest oil consumer," adding: "the stronger dollar also doesn't help today."
The dollar index against a basket of major currencies rose by 0.39 percent by 0844 GMT.
Earlier, U.S. crude rebounded from a one-month low after the House passed the budget deal, inspiring fleeting optimism in markets battered by the disappointing economic data.
The U.S. Institute for Supply Management manufacturing report, a gauge of factory activity in the world's largest economy, fell to 50.9 in July, its lowest since July 2009, data showed Monday.
RISING STOCKPILES
U.S. crude oil inventories probably rose by 1.2 million barrels last week as increased supplies from the Strategic Petroleum Reserve offset losses due to Tropical Storm Don, a Reuters poll showed on Monday.
Gasoline stockpiles were projected unchanged for the week, the poll showed, while distillate stocks were expected to have risen 1.5 million barrels.
Industry data on inventories from the American Petroleum Institute (API) will be published on Tuesday, followed by government statistics from the Energy Information Administration on Wednesday.
In other markets, Asian and European shares fell on Tuesday on concerns about the health of the global economy, while a strengthening yen prompted speculation that Tokyo may intervene in the markets to curb the currency's value. (Additional reporting by Alejandro Barbajosa in Singapore; Editing by Anthony Barker)
