UPDATE 9-Oil retreats after pre-OPEC rally; Brent dips, U.S. crude steady

* Rally fizzles after pre-OPEC hedging, products strength
* Market weighed by Reuters survey on higher OPEC output
* Dollar's rise to 8-month highs another negative factor
* Brent, WTI head for 10 pct drop in November

(New throughout as market reverses early gains)
By Barani Krishnan
NEW YORK, Nov 30 (Reuters) - Brent futures edged lower while
U.S. crude gave back much of its earlier gains on Monday as a
pre-OPEC-meeting rally and run-up in U.S. refined oil products
faltered.
A Reuters survey that estimated higher OPEC production in
November, after a rise in Saudi Arabian output, also weighed on
market sentiment.
Another negative factor was the dollar's surge to an 8-month
high .DXY , which weakened demand for dollar-denominated oil
from holders of the euro and other currencies. USD/
Brent LCOc1 was down 20 cents at $44.66 a barrel as of
1:59 p.m. EST (1859 GMT), after rising nearly $1 earlier.
WTI was up 1 cent at $41.72, versus a session high at
$42.61.
On November's last trading session, Brent and WTI looked set
to end the month down about 10 percent as a global supply glut
showed little signs of diminishing.
Few traders and investors expect any material change to
OPEC's production policy when the Organization of the Petroleum
Exporting Countries convenes in Vienna on Friday. Still, some
had hedged earlier on Monday for the possibility of a surprise.
"We feel the only real hope for oil bulls now would be a
year-end destocking of crude that will create draws," said Tariq
Zahir of New York's Tyche Capital Advisors, which has a bearish
position on WTI.
"Even if we get a bounce in any fashion, that will be prime
opportunity for bears like me to try and ride the elevator down
to the $30 handle."
OPEC is determined to keep pumping oil vigorously despite
the resulting financial strain even on the policy's chief
architect, Saudi Arabia, alarming weaker members who fear prices
may slump further towards $20.
Any policy U-turn would be possible only if large producers
outside the exporters' group, like Russia, were to join
coordinated output cuts. Russia's Energy Ministry said Monday it
would not attend this week's meeting, but expects an
experts-level discussion with OPEC in mid-December.
Russia is, meanwhile, drilling for more oil, according to
data suggesting the No. 1 producer was ready for a long tussle
with OPEC over market share.
Iran, once the second-largest OPEC producer after Saudi
Arabia, hopes to raise crude exports by as much as 1 million
barrels per day within months of having sanctions against its
nuclear program lifted.
U.S. gasoline futures RBc1 were down nearly half a
percent, while ultralow sulfur diesel (ULSD) HOc1 lost almost
1 percent. Both rallied earlier as their front-month contracts
headed for expiry.