UPDATE 9-Oil slides 2 pct, market refocused on global supply glut

* Down after one-day pause as traders await U.S. inventory
reports
* Fears over stockpile builds; Reuters poll sees 1.6 mln
bbls rise
* U.S. crude below $50/barrel for longer than in 2008/2009
* Traders, analysts eye drop to $40 next
* Coming up: API report on U.S. crude inventories at 2130
GMT

(Updates with market extending losses to 2 percent)
By Barani Krishnan
NEW YORK, Nov 17 (Reuters) - Crude oil futures fell about 2
percent on Tuesday, resuming their slide after a one-day pause,
as oversupply concerns returned to suppress a market briefly
lifted by geopolitical worries linked to the Paris attacks.
A Reuters poll of analysts forecast that U.S. crude
stockpiles rose for an eight straight week last week, building
by 1.6 million barrels to reach near-record highs above 490
million barrels seen in April. urn:newsml:reuters.com:*:nL3N13B573
Industry group American Petroleum Institute will issue its
own preliminary report on the stockpile situation at 4:30 p.m.
EST (2130 GMT), two hours after market settlement.
Official inventory data from the U.S. government's Energy
Information Administration is due on Wednesday.
Brent crude futures LCOc1 were down 80 cents at $43.76 a
barrel by 12:35 p.m. EST (1735 GMT). In August, Brent hit a low
of $42.23, which marked a 6-1/2-year bottom.
U.S. crude futures CLc1 were down $1 at $40.74 a barrel,
after hitting a session low of $40.60. In August, U.S. crude had
sunk to a March 2009 low of $37.75.
Brent's premium over U.S. crude CL-LCO1=R was below $2 a
barrel, versus nearly $4 at the start of November. A narrower
spread between the two tends to encourage a greater flow of oil
from abroad into the U.S. market, as crude grades pegged to the
pricier Brent become more affordable.
On Monday, crude prices had gained more than 2 percent on
security fears related to Friday's attacks in Paris, and
France's heavy bombing of Islamic State targets in Syria in the
aftermath. But as calm returned to world markets on Tuesday,
traders and investors focused again on the oversupply in oil.
urn:newsml:reuters.com:*:nL8N13C13A MKTS/GLOB
"Yesterday's rally was a reaction to the likely increase in
geopolitical risk despite the fact Syria itself is not a big oil
producer," said Pete Donovan, broker at New York's Liquidity
Energy. "But as emphasis returns to the oversupply in oil, the
market is giving back those gains."
U.S. crude futures have been under $50 longer now than they
were during the height of the financial crisis in 2008/2009.
Options on U.S. crude expire later on Tuesday, with open
interest mostly gathered around put options, which give the
seller the right, but not the obligation, to sell U.S. futures
at both $40 and $45 a barrel. 0#CLc1

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CHART-Crude prices lower for longer: http://reut.rs/1QI8lmY
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