UPDATE 9-Oil steady as attack in Syria supports but U.S. crude stocks weigh


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    * Turkey starts operation in northern Syria
    * Trump says Turkey's attack on Syria is 'a bad idea'
    * After settlement, Beijing dims U.S.-China trade deal hopes
    * U.S. weekly crude stocks rise more than expected -EIA

 (New throughout, updates prices, market activity and comments
to settlement, adds post-settlement decline on Beijing comments)
    By Laila Kearney
    NEW YORK, Oct 9 (Reuters) - Oil futures were mixed on
Wednesday as a Turkey-launched offensive in Syria and hopes of
progress in ending the U.S.-China trade war supported oil, but a
build in U.S. crude inventories held prices back.
    Brent crude  LCOc1  settled at $58.32 a barrel, up 8 cents,
while U.S. West Texas Intermediate crude  CLc1  settled at
$52.59 a barrel, down 4 cents.
    Later, prices fell from settlement levels after Chinese
officials said Beijing has lowered expectations for progress at
the trade talks this week.  urn:newsml:reuters.com:*:nL2N26U1B1 Negotiators from the
world's top two economies meet in Washington on Thursday in the
latest effort to hammer out a deal.
    Turkey launched a military operation against Kurdish
fighters in northeast Syria, President Tayyip Erdogan said,
adding the offensive was aimed to eliminate a "terror corridor"
along the Turkish border.  urn:newsml:reuters.com:*:nL5N26U431
    Analysts said the attacks could affect the economy of the
oil-producing Kurdistan region in Iraq and boost energy prices. 
    Prices pared gains after U.S. President Donald Trump said
the assault on Syria was "a bad idea" not backed by his
administration.  urn:newsml:reuters.com:*:nW1N26S00J
    Also pressuring prices, U.S. crude inventories grew 2.9
million barrels last week, the Energy Information Administration
said, more than double analysts' expectations for an increase of
1.4 million barrels.  urn:newsml:reuters.com:*:nL2N26U0MJ 
    U.S. crude oil production rose last week to a record of 12.6
million barrels per day.  urn:newsml:reuters.com:*:nL2N26U0P7
    "Weakening oil demand concerns were further supported today
by a larger than expected increase in U.S. crude stocks," said
Jim Ritterbusch, president of oil trading advisory firm
Ritterbusch and Associates. "Demand from the refiners has seen a
larger seasonal decline than widely anticipated."
    U.S.-China trade tensions rose this week as Washington
imposed visa restrictions on Chinese officials and placed some
Chinese companies on a blacklist.  urn:newsml:reuters.com:*:nL2N26T0K3
    China's comments late on Wednesday mitigated hopes for a
deal to end the long-running trade war after reports in
Bloomberg and the Financial Times had spurred optimism for a
deal.  urn:newsml:reuters.com:*:nFWN26T0UF  urn:newsml:reuters.com:*:nB9N263032
    "Crude oil has, just like other riskier assets, received a
boost from news that China is open to accept a partial trade
deal," Saxo Bank commodity strategist Ole Hansen said.
    Commerzbank analyst Carsten Fritsch said if the U.S.-China
talks fail, "the oil price risks suffering a renewed slide
because concerns about demand would then increase considerably
again, especially looking ahead to the coming year."

 (Additional reporting by Bozorgmehr Sharafedin in London,
Florence Tan in Singapore, Devika Krishna Kumar and Stephanie
Kelly in New York; Editing by David Gregorio and Nick Zieminski)
 ((Laila.kearney@thomsonreuters.com; (917) 809-0054))

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