LONDON: Brent crude futures fell on Tuesday, after rising nearly $2 a day earlier, as worries about global economic growth and a stronger dollar tempered appetite for risky assets. The focus remained on the euro zone crisis ahead of a key meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel on the future of the embattled single currency area. September Brent crude futures were $1.40 lower at$108.51 by 0856 GMT. US crude fell by $1.24 to $86.64 by the same time. "All eyes are on this European meeting today, so it's going to be rather choppy and volatile ahead of that," GFT Global market strategist David Morrison said. "(Oil is) reacting to the weakness in the euro, the strength in the dollar, and there is a general risk off mode: nothing fundamental, just traders taking money off the table." Manufacturing in the New York area contracted for the third straight month in August, data showed on Monday, tempering any lingering hopes for a rebound in the second half of the year. The survey is one of the earliest regional guideposts to US factory conditions and analysts said it boded poorly for the larger national survey due at the beginning of September. Worries about the faltering economic recovery also gained prominence after data from Europe's powerhouse Germany showed gross domestic product growth slowed more than expected in the second quarter. "The overall feeling looking at the Germany data is that the outlook for global growth doesn't look particularly good, in which case the upside to oil is capped into the medium term," Morrison added. Oil prices were also pushed lower by a stronger dollar, which makes commodities priced in the greenback more expensive for holders of other currencies. The US dollar strengthened, up 0.43 per cent against a basket of currencies by 0832 GMT. The greenback had fallen to a near three-week low against the euro on Monday. VTB Capital analyst Andrey Kryuchenkov said Brent prices continued to trade in parallel with the UK blue chip index performance. "Brent's monthly rolling correlation to the FTSE 100 index remained at a more than one-year high, near 95%, with intraday direction still dictated mostly by the equity markets at the moment", he wrote in a note. The market will be watching for a slew of US economic reports that come out this week, including housing starts and industrial production data later on Tuesday, for clues on the health of the world's biggest economy. Concerns over the US recovery and the ongoing euro zone crisis have dragged down oil prices this month. Brent surged on Monday as hopes for a resolution to Europe's issues rose ahead of a Tuesday meeting between French and German politicians.

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