--Crude falls back as the euro slides to its lowest level since early October. --Concerns over the euro zone's economy weigh on prices as Italian yields hit a euro-era high. --Concerns over geopolitical tensions with Iran continue to support prices. By Sarah Kent Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Oil futures fell back Friday as the euro slid to its lowest level since early October amid increasing concerns over the economic situation in the euro zone. At 1105 GMT, the front-month January Brent contract on London's ICE futures exchange was 99 cents, or 0.9%, lower at $106.79 a barrel. The front-month January contract on the New York Mercantile Exchange was trading down 31 cents, or 0.3%, at $95.86 a barrel. "This morning the market's pretty much following the euro's move," said James Zhang, strategist at Standard Bank. "The euro sold off and dragged oil down." The euro plunged Friday as the cost of insuring European sovereign debt against default pushed to fresh records, with Italy paying euro-era high yields at its short-term debt auction. The euro zone saga shows no sign of letting up and a lack of clarity over how politicians intend to tackle the problems has left the market jittery and hit the euro hard. At 1105 GMT, the euro was at $1.32550, after touching a fresh seven-week low of $1.32350, from $1.3348 late Thursday in North American trading. A weaker euro tends to weigh on oil prices as it makes the dollar-denominated commodity more expensive for holders of the common currency. However, geopolitical tensions in key oil producing countries continued to lend support to prices, cushioning the market's fall. "Despite continuing headwind on the financial markets--in the form of a rising U.S. dollar, falling equity markets and increasing bond yields in the eurozone--oil prices are remaining amazingly robust," said Commerzbank in a note. Rising tensions between Iran and the West have come sharply into focus this week, after France Thursday said it would seek a Europe-wide embargo on Iranian oil, following fresh sanctions imposed on the country by the U.S., U.K. and Canada Monday. Iran is the second largest oil supplier to Europe after Russia, according to the International Energy Agency, and a ban on crude imports from the Islamic Republic could significantly lift prices. "If France manages to push for a EU-wide ban on Iranian crude oil then it would have greater consequences as that would represent 700,000 barrels a day (excluding Turkey) of crude oil flows," said Olivier Jakob, managing director of Swiss Consultancy Petromatrix in a note. "If Turkey is included then it would represent a ban on close to 1 million barrels a day of Iranian crude oil imports." -By Sarah Kent, Dow Jones Newswires; 4420-7842-9376; sarah.kent@dowjones.com

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